Pfizer to acquire Arena Pharmaceuticals at 100% premium in $6.7-billion deal

• Pfizer will buy Arena in an all-cash deal for a premium of about 100%

• Arena is developing several treatments for gastroenterology, dermatology, and cardiology

Pfizer Inc on Monday said it signed an agreement to buy drug developer Arena Pharmaceuticals Inc for $6.7 billion in cash, which will add a promising treatment candidate for immuno-inflammatory diseases to its portfolio.

The U.S. drugmaker said it would pay $100 a share for acquiring San Diego-based Arena, giving Pfizer access to the diverse assets in gastroenterology, dermatology, and cardiology, according to a statement.

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The offer price is double Arena’s Friday closing price, which surged more than 88% to $94.08 in early trading on Monday.

The share of Pfizer also jumped over 5% to $55.50.

Drug for IBD

Arena’s lead candidate, etrasimod, is currently in the late-stage study for curing ulcerative colitis, an inflammatory bowel disease (IBD) that causes inflammation and ulcers in your digestive tract, and a mid-to-late stage study in Crohn’s disease, an IBD, causes abdominal pain, diarrhea, weight loss, anemia, and fatigue.

Pfizer, who developed the widely used Comirnaty COVID-19 vaccine in collaboration with BioNTech SE, is also developing a treatment for ulcerative colitis, which is currently in phase two trial and is expected to be completed by the end of next year.

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“The proposed acquisition of Arena complements our capabilities and expertise in Inflammation and Immunology,” Pfizer said, mentioning that it plans to accelerate the clinical development of etrasimod.

The company also expects the deal to contribute to growth through 2025 and beyond, as a chronic inflammatory bowel disease affects 3 million people in the United States.

The deal is expected to close in the first half of 2022.

Last month, Pfizer acquired immuno-oncology company Trillium Therapeutics Inc for about $2.22 billion to strengthen its arsenal of blood cancer therapies.

Picture Credit: ABC News