Pfizer has agreed to buy U.S. cancer drug company Medivation for $14 billion cash.
The deal boosts the pharma giant’s oncology roster by including the blockbuster prostate cancer drug Xtandi, worth $2.2 billion-a-year.
Sanofi initially bid to buy Medivation for $52.50 per share in April. Pfizer’s deal represents a 118% increase since Reuters reported that Medivation had hired JP Morgan to handle interest from companies in a potential acquisition in March.
The move comes four months after Pfizer and Allergan Plc abandoned plans for a merger worth $160 billion.
The Medivation deal demonstrates how Pfizer is strengthening its branded drugs portfolio, especially profitable cancer treatments. Its biggest growth driver is a new breast cancer drug, Ibrance.
Pfizer Chief Executive Ian Read said that the Medivation deal was driven in the main by the desire to obtain Xtandi, which generated U.S. net sales of $330.3 million in the second quarter. He also expressed high expectations for Medivation’s experimental drugs for breast cancer and lymphoma, talazoparib and pidilizumab respectively.
The deal has been approved by the boards of both companies and according to Pfizer should be completed in the third or fourth quarter.