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The Zacks Analyst Blog Highlights: Pfizer, Arena Pharma, Merck, Jazz Pharm and Sanofi
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For Immediate Release
Chicago, IL – December 15, 2021 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Pfizer Inc. (PFE - Free Report) , Arena Pharmaceuticals, Inc. , Merck & Co., Inc. (MRK - Free Report) , Jazz Pharmaceuticals plc (JAZZ - Free Report) and Sanofi (SNY - Free Report) .
Here are highlights from Tuesday’s Analyst Blog:
Does Pfizer/Arena Deal Signal Robust Pharma M&A Activity in 2022?
Pfizer announced a definitive agreement to acquire Arena Pharmaceuticals for $100 per share or $6.7 billion in an all-cash deal on Monday. The deal will add Arena’s lead candidate, etrasimod, a next-generation and selective sphingosine-1-phosphate (S1P) receptor modulator, to Pfizer’s inflammation and immunology pipeline.
Etrasimod is in late-stage development for ulcerative colitis (UC). It is also being studied across multiple gastroenterology and dermatology indications. In addition, Arena’s pipeline includes pipeline candidates like temanogrel and APD41, which are in mid-stage development for cardiovascular diseases.
While Pfizer’s stock rose 4.6% on Monday, Arena’s shares were up 80.4% in response to the merger news. Pfizer’s stock has risen 55.6% this year so far compared with an increase of 18.5% for the industry.
The buyout offer came at a significantly high premium of 100% of Arena’s Friday’s closing price of $49.94. The Arena deal is Pfizer’s biggest after the $11 billion acquisition of Array BioPharma in 2019.
In 2021, M&A activity in the pharma and biotech recovered after a dull 2020 when deal-making was hurt by pandemic-led disruption. Though deals were not as plentiful as 2018 and 2019, most of the M&A deals of 2021 were valued at more than $1 billion. Some of the larger deals were Merck’s $11.5 billion acquisition of Acceleron Pharma, Jazz Pharmaceuticals’ acquisition of GW Pharmaceuticals for $7.2 billion and Sanofi’s purchase of Translate Bio for $3.2 billion.
Merck’s pipeline was boosted by the addition of the promising phase III pipeline candidate for pulmonary arterial hypertension, sotatercept, following the acquisition of Acceleron.
Jazz Pharmaceuticals’ neuroscience portfolio was strengthened by the addition of two drugs — Epidiolex and Sativex (nabiximols) — following the above-mentioned acquisition.
Sanofi’s efforts to develop transformative vaccines and therapies using mRNA technology accelerated post its acquisition of Translate Bio.
The Pfizer-Arena deal has raised hopes that M&A activity will pick up significantly in 2022. The deal is being seen as the first of many more to come in 2022 as big drugmakers have huge piles of cash and borrowing power to strike deals. Given that it takes several years and millions of dollars to develop new therapeutics from scratch, large pharmaceutical companies regularly buy innovative small/mid-cap biotech companies to build out their pipelines and drive growth.
Fast-growing and lucrative markets such as oncology and cell and gene therapy are likely to remain focus areas for M&A activities. Importantly, after the success of the mRNA vaccines of Pfizer and Moderna, the mRNA technology has already begun to attract a lot of attention.
Importantly, drugmakers like Pfizer, J&J and Moderna have huge cash resources at their disposal, benefiting from significant revenues from their COVID-19 vaccine sales. Pfizer, may as well make another bolt-on acquisition announcement next year, given strong sales from its COVID-19 vaccine Comirnaty and potentially its oral antiviral pill Paxlovid, which is expected to be granted emergency approval soon.
Though all the deals of 2021 were relatively smaller than the previous mega-mergers of AstraZeneca-Alexion, Bristol-Myers-Celgene and AbbVie-Allergan, a large transaction, at $50 billion or more, cannot be ruled out in 2022.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights: Pfizer, Arena Pharma, Merck, Jazz Pharm and Sanofi
For Immediate Release
Chicago, IL – December 15, 2021 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Pfizer Inc. (PFE - Free Report) , Arena Pharmaceuticals, Inc. , Merck & Co., Inc. (MRK - Free Report) , Jazz Pharmaceuticals plc (JAZZ - Free Report) and Sanofi (SNY - Free Report) .
Here are highlights from Tuesday’s Analyst Blog:
Does Pfizer/Arena Deal Signal Robust Pharma M&A Activity in 2022?
Pfizer announced a definitive agreement to acquire Arena Pharmaceuticals for $100 per share or $6.7 billion in an all-cash deal on Monday. The deal will add Arena’s lead candidate, etrasimod, a next-generation and selective sphingosine-1-phosphate (S1P) receptor modulator, to Pfizer’s inflammation and immunology pipeline.
Etrasimod is in late-stage development for ulcerative colitis (UC). It is also being studied across multiple gastroenterology and dermatology indications. In addition, Arena’s pipeline includes pipeline candidates like temanogrel and APD41, which are in mid-stage development for cardiovascular diseases.
While Pfizer’s stock rose 4.6% on Monday, Arena’s shares were up 80.4% in response to the merger news. Pfizer’s stock has risen 55.6% this year so far compared with an increase of 18.5% for the industry.
The buyout offer came at a significantly high premium of 100% of Arena’s Friday’s closing price of $49.94. The Arena deal is Pfizer’s biggest after the $11 billion acquisition of Array BioPharma in 2019.
In 2021, M&A activity in the pharma and biotech recovered after a dull 2020 when deal-making was hurt by pandemic-led disruption. Though deals were not as plentiful as 2018 and 2019, most of the M&A deals of 2021 were valued at more than $1 billion. Some of the larger deals were Merck’s $11.5 billion acquisition of Acceleron Pharma, Jazz Pharmaceuticals’ acquisition of GW Pharmaceuticals for $7.2 billion and Sanofi’s purchase of Translate Bio for $3.2 billion.
Merck’s pipeline was boosted by the addition of the promising phase III pipeline candidate for pulmonary arterial hypertension, sotatercept, following the acquisition of Acceleron.
Jazz Pharmaceuticals’ neuroscience portfolio was strengthened by the addition of two drugs — Epidiolex and Sativex (nabiximols) — following the above-mentioned acquisition.
Sanofi’s efforts to develop transformative vaccines and therapies using mRNA technology accelerated post its acquisition of Translate Bio.
The Pfizer-Arena deal has raised hopes that M&A activity will pick up significantly in 2022. The deal is being seen as the first of many more to come in 2022 as big drugmakers have huge piles of cash and borrowing power to strike deals. Given that it takes several years and millions of dollars to develop new therapeutics from scratch, large pharmaceutical companies regularly buy innovative small/mid-cap biotech companies to build out their pipelines and drive growth.
Fast-growing and lucrative markets such as oncology and cell and gene therapy are likely to remain focus areas for M&A activities. Importantly, after the success of the mRNA vaccines of Pfizer and Moderna, the mRNA technology has already begun to attract a lot of attention.
Importantly, drugmakers like Pfizer, J&J and Moderna have huge cash resources at their disposal, benefiting from significant revenues from their COVID-19 vaccine sales. Pfizer, may as well make another bolt-on acquisition announcement next year, given strong sales from its COVID-19 vaccine Comirnaty and potentially its oral antiviral pill Paxlovid, which is expected to be granted emergency approval soon.
Though all the deals of 2021 were relatively smaller than the previous mega-mergers of AstraZeneca-Alexion, Bristol-Myers-Celgene and AbbVie-Allergan, a large transaction, at $50 billion or more, cannot be ruled out in 2022.
Both Pfizer and Arena Pharma have a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.