HQ Team
May 18, 2023: Pfizer plans to raise long-term debt worth $31 billion to finance its acquisition of Seagen, according to a company statement.
The debt will be raised through eight tranches and is expected to close on May 19.
“Pfizer intends to use the net proceeds of the offering as part of the financing for Pfizer’s proposed acquisition of Seagen Inc.,” according to the statement.
The notes, other than any issuance of 10-year notes and 30-year notes, are expected to be subject to a special mandatory redemption under certain circumstances if the merger is terminated or does not close by an agreed-upon date, according to the statement.
BofA Securities, Citigroup, Goldman Sachs and J.P. Morgan are acting as joint lead managers and joint book-running managers for the offering.
Cancer portfolio
In March 2023, Pfizer announced that it will buy Seagen for $43 billion to beef up its cancer portfolio as with COVID-19 vaccine sales forecast continued to plummet.
Pfizer, which is investing heavily in new drugs and research as its patents expire, will buy Seagen, a Seattle-based biotechnology company that discovers, develops, and commercialises cancer medicines, for $229 a share in cash.
The companies expect to complete the transaction in late 2023 or early 2024. Pfizer expects to achieve nearly $1 billion in cost efficiencies in the third full year after the completion of the transaction.
Seagen’s medicines, late-stage development programs and expertise in Antibody-Drug Conjugates (ADCs) strongly complemented Pfizer’s Oncology portfolio.
Seagen is set to expand the impact of its therapeutic approach with its pipeline that includes 11 new molecular entities, many with the potential to treat large patient populations and all global commercial rights.
Sales drop
Pfizer’s revenue from COVID-19 vaccine Comirnaty was forecast to plummet by 64% in 2023.
Pfizer also expects a 58% decrease in 2023 revenue from COVID-19 oral antiviral Paxlovid, the company stated during the full-year and fourth-quarter earnings 2022 in January.
Pfizer expected sales of $13.5 billion for Comirnaty in 2023 after generating revenue of $36.8 billion in 2021 and $37.8 billion in 2022 from the vaccine.
As for Paxlovid, the company anticipates $8 billion in 2023 after reporting sales of $18.9 billion for the post-infection treatment in 2022.
