Pfizer
now
has
the
required
regulatory
approval
for
its
$4.9
billion
acquisition
of
obesity
drug
developer
Metsera,
but
whether
and
when
that
deal
closes
may
hinge
on
the
outcome
of
two
lawsuits
the
pharmaceutical
giant
has
filed
in
opposition
to
Novo
Nordisk’s
eleventh
hour
submission
of
a
competing
offer.
The
Federal
Trade
Commission
on
Friday
granted
early
clearance
for
Pfizer’s
proposed
acquisition
of
Metsera,
underscoring
a
key
point
in
the
company’s
lawsuit
against
Metsera
and
Novo
Nordisk
alleging
breach
of
contract.
Pfizer
said
its
acquisition
proposal
offered
the
likelihood
of
a
faster
deal
close
because
the
pharma
giant’s
small
presence
in
metabolic
medicines
was
less
likely
to
spark
antitrust
concerns.
Notably,
Pfizer’s
effort
to
develop
an
oral
obesity
drug
flamed
out
earlier
this
year
due
to
a
safety
signal
in
a
Phase
1
study.
By
contrast,
Novo’s
weekly-injectable
GLP-1
drug
Wegovy
is
currently
the
top-selling
obesity
medication
and
the
Denmark-based
drugmaker
has
a
broad
pipeline
of
additional
obesity
drugs
in
various
stages
of
development
—
many
from
other
business
deals.
Last
week,
Novo
Nordisk
made
an
unsolicited
$6.5
billion
bid
for
Metsera,
whose
lead
program
is
a
longer-acting
GLP-1
agonist
with
the
potential
for
once-monthly
dosing.
Metsera
said
it
would
accept
Novo’s
offer,
which
it
claims
is
a
superior
proposal.
Pfizer
argues
that
Novo’s
offer
cannot
qualify
as
superior
under
the
terms
of
its
merger
deal
with
the
biotech
due
to
the
significant
antitrust
risk.
Metsera’s
regulatory
filings
regarding
Pfizer’s
agreement
noted
that
regulatory
review
of
a
Novo
acquisition
could
take
up
to
two
years
and
the
deal
may
not
close
at
all.
Pfizer
said
in
its
suit
that
these
risks
led
Metsera’s
board
to
turn
down
a
previous
Novo
offer
and
those
risks
remain
unchanged.
The
Pfizer
suit
was
filed
Friday
in
the
Delaware
Court
of
Chancery.
Besides
breach
of
contract,
Pfizer
alleges
Metsera’s
acceptance
of
Novo’s
offer
constitutes
breach
of
fiduciary
duty
and
tortious
interference
in
a
contract.
Pfizer
claims
Novo’s
offer
represents
a
dominant
obesity
drug
company’s
attempt
to
suppress
competition.
The
pharma
giant
also
contends
Novo’s
deal
is
structured
to
deliberately
evade
antitrust
review.
Per
deal
terms,
Novo
would
pay
$56.50
for
each
Metsera
share,
amounting
to
$6.5
billion.
This
payment
would
not
require
regulatory
approval
of
the
deal
and
would
come
before
any
FTC
action.
In
exchange
for
the
payment,
Metsera
would
issue
Novo
non-voting
stock
representing
50%
of
the
company’s
shares,
according
to
the
agreement.
Ten
days
later,
Metsera
would
issue
its
shareholders
a
$56.50
per
share
dividend.
Pfizer
said
this
special
dividend
violates
Delaware
law,
adding
that
Metsera’s
directors
have
breached
their
fiduciary
duties
by
“securing
a
self-interested
indemnification
provision
from
Novo
Nordisk
designed
to
cover
their
unlawful
conduct.”
Pfizer
expands
on
its
anti-trust
allegations
in
a
second
lawsuit
filed
Monday
in
U.S.
District
Court
for
the
District
of
Delaware.
This
suit
argues
that
Novo’s
Metsera
bid
violates
Section
7
of
the
Clayton
Antitrust
Act,
which
bars
M&A
activity
in
instances
where
the
effect
lessens
competition
or
creates
a
monopoly.
Pfizer
said
a
Novo
acquisition
of
Metsera
would
have
anticompetitive
effects
in
the
GLP-1
drug
market.
The
pharma
giant
also
argues
that
Novo’s
deal
with
Metsera
amounts
to
a
conspiracy
that
leads
to
a
restraint
of
trade
in
violation
of
Section
1
of
the
Sherman
Act.
Pfizer
further
alleges
the
deal
is
an
attempted
monopolization
and
conspiracy
in
violation
of
Section
2
of
the
act.
The
suit
claims
Metsera’s
controlling
stockholders
—
Validae
Health,
Population
Health
Partners,
and
funds
of
Arch
Venture
Partners—
are
part
of
this
anticompetitive
conspiracy.
In
its
announcement
of
the
federal
lawsuit,
Pfizer
said
it
“is
taking
this
action
to
preserve
and
enhance
competition
in
this
important
therapeutic
area
and
to
stop
Novo
Nordisk
from
illegally
paying
off
Metsera
and
its
controlling
stockholders
to
gain
control
of,
and
impair
and
potentially
kill,
an
emerging
U.S.
competitor.
Metsera’s
and
its
controlling
stockholders’
actions,
as
well
as
those
of
Novo
Nordisk,
are
in
clear
violation
of
the
antitrust
laws.”
Metsera
issued
a
brief
statement
late
Friday
saying
it
disagreed
with
Pfizer’s
allegations
in
the
first
suit
and
would
address
them
in
court.
The
company
elaborated
slightly
in
a
Monday
statement
issued
in
response
to
the
federal
suit.
“Pfizer
is
trying
to
litigate
its
way
to
buying
Metsera
for
a
lower
price
than
Novo
Nordisk,”
Metsera
said.
“Metsera’s
Board
of
Directors
will
continue
to
stand
firm
on
behalf
of
shareholders
and
patients.
Pfizer’s
litigation
arguments
are
nonsense,
and
Metsera
will
address
them
in
court.”
Meanwhile,
merger
deadlines
are
looming.
Pfizer’s
merger
agreement
with
Metsera
states
that
notification
of
a
superior
offer
gives
the
pharma
giant
four
business
days
to
revise
its
offer.
That
deadline
is
the
close
of
business
Tuesday.
Metsera’s
announcement
of
Novo’s
bid
noted
that
the
Pfizer
agreement
remains
in
full
effect,
and
the
biotech’s
board
of
directors
reaffirms
its
recommendation
that
shareholders
approve
adoption
of
this
agreement.
Metsera
had
scheduled
a
Nov.
13
special
meeting
for
shareholders
to
vote
on
the
Pfizer
proposal.
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