Novo Nordisk and Pfizer sweeten offers for Metsera as bidding war intensifies
US judge declines to intervene in fray because process ‘is creating value for Metsera stockholders’
Novo Nordisk and Pfizer have submitted improved offers for US weight-loss start-up Metsera, but the coveted biotech continues to view Novo’s bid as the “superior” option as the takeover battle escalates.
Meanwhile, a Delaware judge rejected Pfizer’s request for a temporary restraining order to halt Novo’s bid for Metsera. Another hearing has been scheduled for Wednesday. The judge’s decision boosts Novo’s chances of taking over the highly desired weight-loss drugmaker.
Novo’s proposal values the biotech at up to $10bn, up from an earlier offer of as much as $9bn. Under the new proposal, Novo has offered to pay Metsera $62.20 a share upfront in cash almost immediately upon signing, in exchange for a 50 per cent non-voting stake, which converts to a controlling shareholding upon closure. A further $24 a share will be paid later based on the company achieving clinical trial milestones.
Shares of New York-based Metsera shot up 20 per cent to $72.59 on Tuesday after the bids were announced. Shares of Novo and Pfizer were little changed.
The battle pits two big pharma companies against each other that are eager to improve their position in the growing anti-obesity market. Pfizer is trying to enter the market, while Novo, which makes Wegovy and Ozempic, is trying to boost its pipeline after losing ground to Eli Lilly.
The unusual structure of Novo’s offer is designed to ensure investors receive the majority of the cash before the deal undergoes full regulatory scrutiny.
The Denmark-based company on Tuesday said: “Novo Nordisk believes that the proposal, including the structure of the transaction, complies with all applicable laws and is in the best interest of patients who will benefit from our commitment to innovation, as well as Metsera’s shareholders.”
Pfizer had also improved its offer, valuing the company at $8.1bn, or up to $70 a share, up from an earlier bid of up to $7.3bn. The US drugmaker and Metsera have two more business days to continue negotiations.
The latest round of bids adds drama to a contentious takeover battle, in which Pfizer has attempted to exert pressure on its Danish rival through lawsuits.
“My strong sense [is] that it would be wrong for this court to inject itself into [an] ongoing topping process that is creating value for Metsera stockholders,” Morgan Zurn, vice-chancellor of the Delaware Court of Chancery, said on Tuesday in reference to the bidding war.
Last week, Novo topped Pfizer’s original deal for Metsera with an offer of up to $9bn, sparking one of the most contentious bidding wars over a biotech in recent memory.
Pfizer has accused Novo of trying to stifle competition and sued the Danish drugmaker and Metsera to try to block a deal. Its complaints have centred on the structure of its rival’s offer to pay the weight-loss drugmaker almost immediately upon signing — a manoeuvre Pfizer called “an old-fashioned bribe”.
Pfizer chief executive Albert Bourla criticised Novo’s Metsera bid on Tuesday. “It is an illegal attack by a foreign company to do an end run around antitrust laws, taking advantage of the government shutdown,” he said during an earnings call.
Novo is attempting to “cut and kill an emerging competitor, which is a significant antitrust concern given Novo’s dominant market position” in the weight-loss drugs market, he said.
Asked about the Federal Trade Commission’s move to fast-track Pfizer’s antitrust approval during a government shutdown, Bourla denied any involvement. “No, I think the FTC made their own decision,” he said. “I don’t want to speak for them.”