After a failing to close a huge merger with Allergan in April, Pfizer has found its new target.
The company is seeking to complete its nearly half dozen therapeutic areas of focus with a variety of acquisitions, in order to expand its final-stage pipeline and provide earnings accumulation rather quickly for its shareholders. During Pfizer’s quarterly conference call, CEO Ian Read said that the company was earnestly eyeing on methods to boost its innovative business with late-stage commercial products.
On May 16, Pfizer disclosed its plan to purchase Anacor Pharmaceuticals for approximately $5.2 billion, or a 55 percent premium to where Anacor shares closed on Friday. The bellwether of the acquisition is crisaborole, a non-steroidal modern anti-inflammatory PDE-4 inhibitor that has been submitted to the United States for review as a remedy for atopic dermatitis. The drug is also being examined as a treatment for psoriasis. The pharmaceutical giant believes that Anacor’s lead compound could generate as much as $2 billion in maximum annual sales.
"Crisaborole is a differentiated asset with compelling clinical data that, if approved, has the potential to be an important first-line treatment option for these patients and the physicians who treat them," explained Albert Bourla, Group President of Pfizers Global Innovative Pharma and Global Vaccines, Oncology, and Consumer Health Businesses.
The compelling clinical data mentioned by Bourla come from the AD-301 and AD-302 phase 3 researches released in July last year that showed a statistically important advantage in eliminating the chronic rashes that occur with atopic dermatitis compared to the placebo.
Moreover, Pfizer obtains access to topical toenail fungal treatment Kerydin, which was approved the Food and Drug Administration in July 2014.
The company is convinced that the deal will not materially affect its forecasts in 2016, that it will be slightly dilutive to full year earnings per share next year, and will be accretive to its bottom-line in 2018 as well as the following years.
However, some analysts believe that the leading drug manufacturer may have spent too much for Anacor, as the company has other modern anti-inflammatory products in progress, but they are all in the pre-clinical stages of development.
Shares of Pfizer surged 1.28 percent, or $0.43 in its last trading session, taking the stock price to $34.10. The company’s stock trades lower than it was during the same period last month, with the stock price down by 0.53 percent.
The stock has a 52 week high of $36.46, while its 52 week low is registered at $28.25. Pfizer’s existing market capitalization is 211,143,108,000, that gives the company a mega market cap. Meanwhile, price to earnings ratio of the stock is 14.30.
Pfizer recently posted earnings of 1.35 per share, and it has a dividend yield of 3.56 percent.
Pfizer Aims to Excel in Oncology
Pfizer sees a great potential in oncology, and it is currently investing a great amount in researching new drugs and developing existing market drugs for new uses. However, unlike its rivals, the pharmaceutical leader doesn’t get enough credit for its oncology sector.
"Im not sure were getting credit for oncology yet at Pfizer," Liz Barrett explained at the Grand Hyatt New York on Monday. "Ibrance, yes, but we have a broad portfolio."
Pfizer’s Ibrance mix therapy for metastatic breast cancer has performed significantly well, beating analyst expectations since its launch nearly a year ago.
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