- Pfizer Inc. (NYSE: PFE) announced it is buying Biohaven Pharmaceutical Holding Company Ltd. (NYSE: BHVN) in a deal valued at $11.6 billion in cash. This is why.
Today Pfizer Inc. (NYSE: PFE) and Biohaven Pharmaceutical Holding Company Ltd. (NYSE: BHVN) announced that the companies have entered into a definitive agreement under which Pfizer will acquire Biohaven, the maker of NURTEC ODT, an innovative dual-acting migraine therapy approved for both acute treatment and episodic prevention of migraine in adults.
Under the terms of the deal, Pfizer will acquire all outstanding shares of Biohaven not already owned by Pfizer for $148.50 per share in cash. Biohaven common shareholders, including Pfizer, will also receive 0.5 of a share of New Biohaven, a new publicly traded company that will retain Biohaven’s non-CGRP development stage pipeline compounds, per Biohaven common share.
The boards of directors of both Biohaven and Pfizer have unanimously approved the transaction. And Pfizer will pay transaction considerations totaling approximately $11.6 billion in cash. Pfizer will also make payments at closing to settle Biohaven’s third-party debt and for the redemption of all outstanding shares of Biohaven’s redeemable preferred stock. The $148.50 cash consideration represents a premium of approximately 33% to Biohaven’s volume-weighted average selling price of $111.70 over the three months prior to the announcement of the transaction.
The proposed transaction includes the acquisition of Biohaven’s calcitonin gene-related peptide (CGRP) programs including:
1.) Rimegepant:
– Approved in the United States (U.S.) under the trade name, NURTEC ODT, for both the acute treatment of migraine and preventive treatment of episodic migraine
– Approved in the European Union under the trade name, VYDURA, for both acute treatment of migraine and prophylaxis of episodic migraine
2.) Zavegepant:
– On track for a 2Q2022 acceptance (based on March 2022 submission) in the U.S. as an intranasal spray for the acute treatment of migraine and in development as an oral soft gel for chronic migraine prevention
3.) A portfolio of five pre-clinical CGRP assets
This agreement follows the November 9, 2021 collaboration for the commercialization of rimegepant and zavegepant outside the United States, in connection with which Pfizer invested $350 million to acquire 2.6% of Biohaven’s common stock at $173 per share.
Following the closing, New Biohaven will continue operating under the Biohaven name. And New Biohaven will be led by Vlad Coric, MD, as Chairman and CEO, and include other members of the current management team of Biohaven. Biohaven common shareholders will receive, for each Biohaven share, 0.5 of a share of New Biohaven distributed via a pro rata distribution of SEC-registered, publicly listed shares. At distribution, New Biohaven will be capitalized with $275 million of cash. New Biohaven will also have the right to receive tiered royalties from Pfizer on any annual net sales of rimegepant and zavegepant in the United States in excess of $5.25 billion.
Pfizer expects to finance the transaction with existing cash on hand. And Pfizer’s acquisition of Biohaven is subject to the completion of the New Biohaven spin-off transaction and other customary closing conditions, including receipt of regulatory approvals and approval by Biohaven’s shareholders. The companies expect the transaction to close by early 2023.
Due to the proposed transaction, Biohaven is not going to hold a conference call to discuss its first quarter 2022 financial results and will issue a press release and file a quarterly report on Form 10-Q.
KEY QUOTES:
“Today’s announcement builds on our legacy of delivering breakthroughs for patients living with complex pain disorders and diseases that disproportionately impact women. NURTEC ODT, which is already the #1 prescribed migraine medicine in its class in the United States, coupled with Biohaven’s CGRP pipeline, offers hope for patients suffering from migraine worldwide. We believe Pfizer is uniquely positioned to help the portfolio reach its full potential given our leading scale and capabilities, including comprehensive field force engagement with Primary Care Physicians, specialists and health systems delivering the right information at the right time.”
– Nick Lagunowich, Global President, Pfizer Internal Medicine
“We are excited to announce Pfizer’s proposed acquisition of Biohaven, recognizing the market leadership of NURTEC ODT, our breakthrough all in one migraine therapy, and the untapped potential of our CGRP franchise. Pfizer’s capabilities will accelerate our mission to deliver our migraine medicines to even more patients, while the new R&D company is well positioned to bring value to patients and shareholders by focusing on our innovative pipeline for neurological and other disorders. We believe this transaction represents significant future value creation for patients and our collective shareholders.”
– Vlad Coric, MD, Chairman and Chief Executive Officer of Biohaven
