Drug major Pfizer Inc. (PFE) announced Tuesday a definitive agreement to acquire Biohaven Pharmaceutical Holding Co. Ltd. (BHVN) for $148.50 per share in cash.
In pre-market activity on NYSE, Biohaven shares were gaining around 71 percent to trade at $142.01.
Biohaven is the maker of NURTEC ODT, an innovative dual-acting migraine therapy approved for both acute treatment and episodic prevention of migraine in adults.
Pfizer will pay transaction consideration totaling around $11.6 billion in cash. Pfizer will also make payments at closing to settle Biohaven’s third party debt and for the redemption of all outstanding shares of Biohaven’s redeemable preferred stock.
Under the deal terms, Pfizer, which already owns 2.6 percent in Biohaven, will acquire all remaining shares for $148.50 per share.
Biohaven shareholders, including Pfizer, will also receive 0.5 of a share of New Biohaven, a new publicly traded company that will retain Biohaven’s non-CGRP development stage pipeline compounds, per Biohaven common share.
The boards of directors of both Biohaven and Pfizer have unanimously approved the transaction.
The $148.50 cash consideration represents a premium of approximately 33 percent to Biohaven’s volume weighted average selling price of $111.70 over the three months prior to the announcement of the transaction.
Pfizer’s acquisition is subject to the completion of the New Biohaven spin-off transaction and other customary closing conditions. The companies expect the transaction to close by early 2023.
Following the closing, New Biohaven will continue to operate under the Biohaven name. New Biohaven will be led by Vlad Coric as Chairman and CEO, and include other members of the current management team of Biohaven.
Pfizer expects to finance the transaction with existing cash on hand.
In November last year, the companies entered into collaboration for the commercialization of rimegepant and zavegepant outside the United States, in connection with which Pfizer invested $350 million to acquire 2.6 percent of Biohaven’s common stock at $173 per share.
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