Pfizer Inc. (NYSE: PFE) decided to buy Anacor Pharmaceuticals Inc. (NASDAQ: ANAC) in a $5.2 billion deal to gain control of an experimental treatment for eczema. This is Pfizer’s first deal since the company discarded plans to buy Allergan (NYSE: ACT) for $160 billion just a month ago.
On a statement on Monday, the companies established that Pfizer will pay $99.25 in cash for each Anacor share. The transaction is expected to be completed by the third quarter of the year, and it’s likely to start adding to Pfizer’s earnings in 2018.
Centerview Partners and Guggenheim Securities were Pfizer’s financial advisers, while Citigroup Inc. served as Anacor’s financial adviser.
Anacor’s principal product is crisaborole, an anti-inflammatory, non-steroidal topical treatment. After the three-stage drug testing process designed to ensure the product’s safety and efficacy, Anacor requested permission from the Food and Drug Administration (FDA) to sell the treatment of mild to moderate eczema. The FDA is supposed to make a decision on by January.
Pfizer is looking to acquire products that are about to hit the market. At the same time, the company is considering a split of the business due its failed attempt to buy Allergan, according to Chief Executive Officer Ian Read.
After the U.S. Treasury announced rules that would have reduced tax benefits, Pfizer walked away from the deal with Allergan.
Crisaborole might have peak annual sales of $2 billion
Around 25 million people in the U.S suffer from eczema, whose main symptom is a chronic rash that can last two weeks or more. Pfizer projected that the treatment of mild-to-moderate eczema might have peak annual sales of $2 billion, which will help bolster its inflammation and immunology group.
“We believe the acquisition of Anacor represents an attractive opportunity to address a significant unmet medical need for a large patient population with mild-to-moderate atopic dermatitis, which currently has few safe topical treatments available,” said Albert Bourla, group president of Pfizer’s division for vaccines, oncology and consumer health care, in a statement.
According to Bloomberg, shares of Pfizer fell 0.8 percent to $32.91 in New York before the markets opened, while Anacor jumped 54 percent to $98.41.
Pfizer affirmed that the decision of whether to split the company, which could offer tax benefits, will be done by the end of 2017.
2016 fiscal guidance would not be affected by the deal, but it will be “slightly dilutive” to its earnings per share beginning in 2017, Pfizer claimed.