NEW YORK & BOULDER, Colo.—In one of its largest deals in years, Pfizer Inc. has announced plans to acquire biopharmaceutical company Array BioPharma Inc. The companies announced the signing of a definitive merger agreement, under which Pfizer will acquire Array for $48 per share in cash, which brings the total enterprise value of the deal to roughly $11.4 billion. Both Pfizer's and Array's boards of directors have approved the transaction.
Per the agreement, a Pfizer subsidiary will commence a cash tender offer to purchase all outstanding shares of Array common stock for $48 per share. The offer is subject to customary closing conditions, including regulatory approvals and the tender of a majority of the outstanding shares to the offer. Any shares not tendered to the offer will be acquired through a second-step merger, to be completed following the closing of the tender offer. The transaction is expected to be complete in the second half of this year.
“Today’s announcement reinforces our commitment to deploy our capital to bring breakthroughs that change patients’ lives while creating shareholder value,” said Albert Bourla, CEO of Pfizer. “The proposed acquisition of Array strengthens our innovative biopharmaceutical business, is expected to enhance its long-term growth trajectory, and sets the stage to create a potentially industry-leading franchise for colorectal cancer alongside Pfizer’s existing expertise in breast and prostate cancers.”
“We are very excited by Array’s impressive track record of successfully discovering and developing innovative small-molecules and targeted cancer therapies,” added Mikael Dolsten, Pfizer's chief scientific officer and president, Worldwide Research, Development and Medical. “With Array’s exceptional scientific talent and innovative pipeline, combined with Pfizer’s leading research and development capabilities, we reinforce our commitment to advancing the most promising science, regardless of whether it is found inside or outside of our labs.”
Pfizer forecasts that the deal will be dilutive to its adjusted diluted earnings per share by roughly the same amount this year and next year—approximately $0.04 to $0.05—while turning neutral in 2021 and accretive by 2022. Once the deal is complete, Array's employees will join those of Pfizer, continuing at Array's current locations in Cambridge, Mass., Morrisville, N.C., and Boulder, Colo. The latter will become part of Pfizer's Oncology Research & Development network.
“We are incredibly proud that Pfizer has recognized the value Array has brought to patients and our remarkable legacy discovering and advancing molecules with great potential to impact and extend the lives of patients in critical need,” said Ron Squarer, Array chief executive officer. “Pfizer shares our commitment to patients and a passion for advancing science to develop even more options for individuals with unmet needs. We’re excited our team will have access to world-class resources and a broader research platform to continue this critical work.”
The key drivers inspiring this transaction are some of the cancer therapies in Array's portfolio—namely, Braftovi (encorafenib) and Mektovi (binimetinib) for the treatment of BRAFV600E or BRAFV600K mutant unresectable or metastatic melanoma. The two drugs are approved for combined use in this indication, and is currently being evaluated in more than 30 clinical trials across a variety of solid tumor indications, including BRAF-mutant metastatic colorectal cancer.
Just last month, Array announced that the interim analysis of the Phase 3 BEACON metastatic colorectal cancer trial showed that second-or-third-line treatment with the combination therapy of Braftovi, Mektovi and cetuximab resulted in statistically significant improvement in overall response rate and overall survival compare to the control group, with a 48-percent reduction in the risk of death. Should it gain approval, this regimen could be the first chemotherapy-free treatment approach for colorectal cancer patients with BRAF-mutant type cancer.
Additional programs in Array's pipeline are selumetinib, which is targeting neurofibromatosis type 1, a disease in which nonmalignant tumors grow on nerves; LOXO-292, which is targeting cancer; ipatasertib, which is directed against AKT in cancer; and tucatinib, being developed against HER-2 in cancer, among other programs. These compounds are being developed in partnership with AstraZeneca, Eli Lilly, Genentech and Seattle Genetics, respectively.