Five months after discontinuing the development of its own obesity treatment, Pfizer has announced a nearly $5 billion acquisition of the development-stage drugmaker Metsera.
The deal signals a major strategic push by the pharmaceutical giant into the rapidly growing and highly lucrative market for weight-loss drugs, which is currently dominated by Novo Nordisk’s Wegovy and Eli Lilly’s Zepbound.
Details of the Pfizer Metsera deal
Pfizer will pay $47.50 in cash for each share of Metsera, a premium of over 42% to the stock’s closing price on Friday. The total value of the deal is approximately $4.9 billion, but it could increase. Pfizer has also agreed to a potential additional payment of $22.50 per share, contingent on Metsera’s product pipeline achieving specific clinical and regulatory milestones. This could bring the total value of the acquisition to as much as $7.3 billion.
Metsera currently has no products on the market, but its pipeline includes several promising oral and injectable treatments for obesity. Pfizer CEO Albert Bourla stated that the acquisition will bring valuable expertise and a strong portfolio of potential treatments into the company, which is critical for addressing the more than 200 health conditions associated with obesity.
“The acquisition aligns with our focus on directing our investments to the most impactful opportunities and propels Pfizer into this key therapeutic area.”
The deal has been approved by the boards of both companies but still requires approval from Metsera shareholders and regulators. The acquisition is expected to close in the fourth quarter of this year.
Market reaction and the competitive landscape
The announcement had an immediate and significant impact on the stock market. Metsera stock (MTSR) skyrocketed, with its price increasing by about 60% in premarket trading. Pfizer stock (PFE) also saw a modest climb following the news.
The acquisition comes after Pfizer ended the development of its own once-daily obesity pill, danuglipron, in April due to concerns about potential liver damage. This new deal allows the company to re-enter the market with a strong portfolio of candidates. Demand for effective obesity treatments has soared, with Eli Lilly’s Zepbound generating $5.7 billion in sales in the first half of the year alone. However, these drugs can cost patients hundreds of dollars a month. Pfizer’s entry into the market with new treatments from the Metsera pipeline could eventually introduce more competition and potentially help drive down prices.
