Pfizer has successfully negotiated a deal valued at up to $10 billion to acquire weight-loss start-up Metsera, concluding a highly publicized takeover contest that saw rival pharmaceutical giant Novo Nordisk attempt to make a competing offer. The bidding war was ignited after Novo, known for its popular weight-loss drugs Ozempic and Wegovy, presented an unsolicited bid for Metsera in late October.
Metsera announced on Friday that it would proceed with Pfizer’s offer, primarily influenced by antitrust concerns raised by the U.S. Federal Trade Commission (FTC) regarding Novo’s approach. This new agreement positions Metsera’s valuation at approximately $2.7 billion higher than a prior agreement made in September. According to the terms, Metsera shareholders will receive an upfront cash payment of $65.50 per share, along with an additional potential $20.65 per share contingent on achieving specific clinical trial milestones.
The vetting process faced scrutiny when the FTC warned Metsera about the potential legal complications of Novo’s unique deal structure, which included an immediate payout of more than $7 billion through a dividend. Pfizer reacted strongly against this maneuver, initiating lawsuits to prevent Novo’s acquisition and claiming that it could potentially breach antitrust regulations. The FTC’s letter to Metsera expressed concern that the unusual dividend arrangement could lead to future legal challenges, including a demand for the reimbursement of the upfront payment.
Founded just three years ago and currently employing around 100 people, Metsera boasts a promising pipeline of experimental treatments aimed at weight loss, featuring innovations such as a longer-acting injectable, a weight-loss pill, and drugs employing distinct chemical mechanisms.
The competitive landscape has been tumultuous, particularly for Novo, which has seen its shares plummet by 50% as fears mount among investors regarding its position in the race for dominance in the weight-loss drug market. Novo’s new CEO, Maziar Mike Doustdar, has been vocal in asserting that Pfizer needed to increase its bid if it desired to secure Metsera. On a recent visit to the White House to announce a drug pricing deal, Doustdar remarked that Pfizer should “put your hand in your pocket and bid higher.”
In response, Pfizer’s CEO, Albert Bourla, has criticized Novo’s tactics, characterizing the bid as an underhanded maneuver that seeks to bypass existing antitrust laws during a government shutdown. As the dust settles from this corporate clash, the implications for the burgeoning weight-loss drug market remain to be seen, with Pfizer now holding a significant position as it aims to enhance its portfolio in the face of earlier setbacks in clinical trials for its own weight-loss treatments.
