Pfizer Drops Pursuit Of AstraZeneca

Pfizer ended its attempt to take over AstraZeneca last week after the British firm rejected its final $119 billion offer. “We continue to believe that our final proposal was compelling and represented full value,” Pfizer CEO Ian C. Read said.

In turning down the U.S. company’s bid, AstraZeneca Chairman Leif Johansson declined to heed some shareholders who wanted him to at least engage in talks. Rather, Johansson said he preferred to take “the opportunity to continue building on the momentum we have already demonstrated as an independent company.”

Pfizer is now bound by U.K. takeover code, which prevents it from making an offer for three months, according to ISI Group analyst Mark Schoenebaum, who has been following the saga. Any offer within six months would require consent from AstraZeneca or an exception from the takeover board, Schoenebaum says.

The two big pharma companies now separately face the task of turning around their lackluster financial performance of recent quarters. For its part, AstraZeneca anticipates positive drug development news in the coming months.

Meanwhile, rather than pursuing another megamerger, Pfizer is apt to “focus on bolt-on acquisitions in areas where AstraZeneca would have given them some added strength,” Credit Suisse analyst Vamil Divan said in a recent report. Such areas include immuno-oncology, inflammation, and emerging markets, he added.

Pfizer recently reiterated that its long-term strategy, with or without the AstraZeneca deal, is to split into three parts: innovative pharmaceuticals; generic drugs; and vaccines, oncology, and consumer health.