Pfizer Inc. agreed to purchase cancer-drug maker Seagen Inc. for an enterprise value of $43 billion, gaining the company’s antibody drugs that fight tumors.
Pfizer will pay $229 a share in cash for Seagen, according a statement, about a third more than the drugmaker’s closing share price Friday.
Seagen is a leader in developing a type of medicine called antibody-drug conjugates, or ADCs. These precision medicines deliver cancer-killing drugs so potent they might otherwise be too toxic to use. The new delivery mechanism uses antibodies to deposit a strong concentration of drug directly at a tumor site, which may increase efficacy with fewer side effects.
Pfizer has been under pressure to show it can capitalize on its Covid-19 windfall, after vaccine revenue almost doubled its sales in a single year. While the Seagen deal is smaller than some of Pfizer’s megadeals of the past, it’s a bid for an expanded platform in a field, oncology, that will be the industry’s biggest growth market, chief executive officer Albert Bourla said.
Pfizer expects to finance the transaction substantially through $31 billion of new, long-term debt, and the balance from a combination of short-term financing and existing cash, according to the statement. Seagen is expected to contribute more than $10 billion in risk-adjusted revenues in 2030.
The deal will double Pfizer’s pipeline of early-stage experimental cancer therapies, the company said.