Pfizer buys Global Blood Therapeutics for $5.4b

Pharmaceutical giant Pfizer (NYSE: PFE) has announced it has acquired biopharmaceutical company Global Blood Therapeutics (NASDAQ: GBT) for roughly $5.4 billion in an effort to boost its pipeline.

Flush with cash from mass sales of its COVID-19 vaccine last year, Pfizer has been looking for the right opportunities to invest the money and capitalize on its surge in revenue, aiming to bring in billions in annual sales by the end of the decade.

The company ultimately settled on paying $68.50 per Global Blood share, paying a premium to fend off other takeover interest, resulting in a total enterprise price of $5.4 billion.

Pfizer’s revenue figures reached $81.3 billion in 2021, nearly double that of the previous year, largely due to the vaccine sales.

After releasing its COVID-19 antiviral pill Paxlvoid, and with rising case numbers, Pfizer expects to generate roughly $100 billion in revenue through 2022. However, the company expects the demand in its products to start declining thereafter.

Pfizer chief business innovation officer and executive vice president Aamir Malik said diversifying merger and acquisition deals gives the brand a great opportunity to maximize growth.

“We think that there are opportunities across all therapeutic areas that we’re active in,” he said.

Recent acquisitions

In May, Pfizer completed a deal worth $11.6 billion to acquire Biohaven Pharmaceutical, a migraine drug maker.

Pfizer also recently completed a $6.7 billion deal to buy Arena Pharmaceuticals, a company developing innovative potential therapies for the treatment of several immuno-inflammatory diseases.

New acquisition adds sickle cell expertise

In an effort to diversify, Pfizer acquired Global Blood in an effort to add sickle cell expertise.

The biopharma company’s sickle cell disease treatment Oxbryta was approved in 2019 and is expected to bring in $260 million in sales this year.

The company also has two other assets, GBT601 and inclacumab, which target the same disease.

At its peak, if all are approved, Global Blood’s drugs are expected to generate more than $3 billion in sales annually.

Sickle cell disease, an inherited blood disorder, affects around 70,000 to 100,000 people in the United States alone.

Pfizer chairman and chief executive officer Albert Bourla said the company will aim to continue assist the disadvantaged people dealing with such a disease.

“Sickle cell disease is the most common inherited blood disorder, and it disproportionately affects people of African descent,” he said.

“We are excited to welcome GBT colleagues into Pfizer and to work together to transform the lives of patients, as we have long sought to address the needs of this underserved community.”

Global Blood Therapeutics chief executive officer Ted Love said given Pfizer’s sheer size and resources, it has a greater opportunity to launch Oxbryta in other markets and assist its growth.

“We really have no infrastructure outside of that (US and western Europe) and it takes time and money to build out those infrastructures, and Pfizer already has all of it,” he said.