22 Dec Holiday Gift From Big Pharma
Monday’s Wall Street Journal featured the news of pharmaceutical giant Pfizer acquiring Midwest biotech company Esperion Therapeutics for $1.3 billion.
Esperion, which is based in Ann Arbor, Mich., develops cardiovascular medicine that may be useful for the treatment of the heart disease atherosclerosis. Remember that Pfizer has a huge cardiovascular franchise with drugs like Lipitor for high cholesterol ($8 billion in annual sales) and Norvasc for the treatment of blood pressure and angina.
Pfizer is offering Esperion shareholders a 54 percent premium on the company’s recent stock price, which shows how much it is willing to pay for this exciting technology/product pipeline. Remember that Esperion was formed by former Warner-Lambert scientists who split off from Warner-Lambert a few years ago. Also remember that Pfizer still has a large cardiovascular research effort in Michigan.
This seems to be a good fit and reflects well on the value of some of the biotech products being developed in the Midwest. Remember also that we started the year with a large Pfizer license deal for an osteoporosis product from Deltanoid Pharmaceuticals in Madison, Wis.
Pfizer obviously is having luck troving for products in the Midwest.
For those of you who follow this column on a regular basis, you will remember that Esperion is part of the ePrairie Midwest Biotech Index. Earlier this year, we indicated that it was one of the fastest-growing companies during 2003 in terms of market valuation.
Biotech IPO Market
According to the Journal, seven biotech companies have gone public since October.
They have raised $450 million with an additional 13 companies teed up to raise another $1 billion. Of the seven that have gone public thus far this year, all except Genitope (cancer vaccines) are trading below the initial IPO price. As a group, the first seven are down 16 percent since their offerings.
Eyetech Pharmaceuticals was queued up for close to a $150 million IPO. Though Eyetech has a deal with Pfizer valued up to $745 million for its macular degeneration product Macugen, it appears that this IPO has been postponed to January.
Acorda Therapeutics, another company with an IPO filing hoping to raise $62 million, has pulled its IPO for 2003, according to Journal. Though it looks like the action is now over for 2003, stay tuned for 2004. Happy holidays and see you next week!
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Michael S. Rosen is the vice chairman of human health at the Illinois Biotechnology Industry Organization (IBIO). He can be reached at rosenmichaels@aol.com. This article has been syndicated on the Wisconsin Technology Network courtesy of ePrairie, a user-driven business and technology news community distributed via the Web, the wireless Web and free daily e-mail newsletters. They can be found at www.eprairie.com.
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