This is taking stock with pim Box and Kathleen Hayes on Bloomberg Radio, Fiser Fiser beating out a SnO fee to take Metivation. It's a fourteen billion dollar deal, and fires are looking to acquire not only Metivations pipeline, but a significant cancer drug to fight prostate cancer. Cynthia Coon's is Bloomberg's own healthcare reporter and she joins us in studio. Cynthia, very nice to see you. Thank you for being here.
Why does Fightser need to buy Metivation, particularly at such a fourteen billion dollar price tag, which I believe is about double what Snofi had offered or had been talking about when they decided that Metivation was a company worth looking at. Well, Fightser is really in this to build up their pipeline. What Fiser wants to do is build the two different sides of the company, the innovative side and the branded side with the older match her drugs.
And what they've talked about doing is splitting the company into But what analysts say can't happen at this stage is they can't split up yet. They don't have enough of an innovative pipeline for them to be able to justify doing that sort of a division of the company.
And so this is part of what will probably be a series of deals for a Fightser to buy more pipeline because while they have this drug you mentioned for prostate cancer and they could potentially add indications there, what's coming down the pike is the other drugs that they have, and that's what fighter is really focused on, and that's
where they really see the value in this asset. Well know, sadly for so many people, but good for the pharmaceutical industry and then of course for people who are fighting cancer. There are it's a very very hard hot part of the big farmer world biotech along the lines um extending more of a late stage drug apparently, uh, the question is late stage versus early stage. This is a big part of this deal being done correct. Extandy is probably what makes it the most attractive, and that Fightser has
already said that they want to do. As for assets where there are drugs already on the market. I mean there's two types of deals a pharmaceutical company can do. They can buy something that's purely exploratory doing a lot of early stage research, and that can hold a lot
of promise. You can find a lot of gems in there, but it's a lot of risk, and Fiser wants to make sure that they're doing deals where they're going to be able to show shareholders, we have this much money coming in the door in year one or year two, and that's that's what Xtandi offers. But Meditation certainly has
other drugs that are further down the pike. And Fiser has its own pipeline in oncology and it's a part has a partnership with German merc which is also part of its big oncology platform to move into the immuno oncology space, which is really where a lot of the hot innovation is going on right now. So just to understand, Fiser is bulking up on these innovative new drugs in order to eventually split the company into a company that has innovative and new drugs and it's branded portfolio of
older drugs. Well, that was always the plan, but what they said today essentially was that they've said since the Allergan deal didn't work out earlier this year, which would fall more in the branded side than stay innovative, for example, but since the Allergan deal didn't work out. They've said they would make a decision by the end of this year, and they said today they're still sticking to that timeline. So analysts are saying at this point, probably they're not
going to split. Probably they don't feel like they have enough on the innovative side to make it its own company. But that is essentially the strategy they've been pursuing. And no matter what they do, you need pipeline as a pharmaceutical company. That's where all the growth is coming from
from the new drugs and the blockbusters. So no matter what they decided to do, if they split or stay stay together, they really need to make sure that they have drugs coming down the pipe that will get approved in two just to keep the revenue studying. Well, just to give you the detail, and kathink go right ahead, because I just gonna tell you that Fiser shares right now down about fourteen cents, thirty four dollars eighty four cents. The stock is about eight percent so far this year,
pays about a three and a half percent dividend. Well and cine your story mentioned and to experimental products, a drug for breast cancer, another one for the blood cancer lymphoma, again, these are the kinds of cancers that touch so so many lives. Um, what kind of what are analysts saying about this deal about where the company is heading, particularly again with these cancer drugs that are so so important.
I think what analysts really want to see now, and it's going to take probably some time, is to see whether or not they can actually develop these drugs and how successful these drugs are going to be. I mean, as much as it's it's um they might be looking at big indications where there's a lot of promise, there's there have been major drug failures in every disease area, and particularly and oncology. Even some of the greatest breakthroughs
have only affected small segments of patient population. So even though they might be going after some of these big areas, there's a lot of competition, and Fiser has their own breast cancer drug that's been very successful, and so what Visor talked a little bit today about was doing combinations with their existing drugs and other things in the pipeline, and that's where things really exciting from a patient's point
of view. But then it also gets tricky from a payer point of view, because how does the medical system absorb the cost of several very high priced drugs. So that's kind of the future of the debate in oncology and where we'll have to see the debate go if we figure out if these drugs do work. So that will be another dimension to this story, but probably not
for several years. Does Fightser spinoff or get rid of businesses while they're trying to sort out the bigger issue of splitting the company, I mean their non core assets that you could see Fightser trying to sell into the marketplace. I mean, there certainly are small pieces here and there. I don't think Fightser is a company quite like some others where you might segment out big chunks and say, oh,
they should get rid of that. I mean, there are pieces that they picked up through the Hospia transaction and through other deals they've been doing that could potentially bamboo therapeutics. I know that they've been doing a lot of small deals as well, anacore pharmaceuticals and so on. Yeah, and in some of these deals there might be part to the business that aren't necessarily valuable to Fiser. So they could pick up a pick up an asset and then
sell off a small piece. But the story about Fiser isn't going to be about investors is it's going to be about acquisitions. There's no doubt they're going to continue to be very busy on the deal front, and they're going to continue to do lots of deals, and they can do large deals. That's the capacity that Fightser has. They have a lot of money, and they're a force to be reckoned with, as everyone learned just looking at the valuations that they were able to pay today compared
to everyone else. So thank you, so very much. She's a healthcare reporter for Bloomberg News talking to us about Fiser beating out Santa Fe to take motivation in the fourteen billion dollar deal. Of course, it's very important what this means for investors, however, so important what it means for people. It's one of the things that makes this big farming industry so very very interesting. And Kathleen Hayes along with pim Fox and this is Bloomberg