Anacor Pharmaceuticals (ANAC) to Be Acquired by Pfizer in $5.2B Deal

Shares of Anacor Pharmaceuticals Inc. (ANAC) were trading up +34.42 or +53.76 percent to $98.45 per share in Monday’s premarket after news that it had entered into a definitive agreement with Pfizer Inc. (PFE) in which Pfizer will acquire Anacor in a cash transaction valued at approximately $5.2 billion. Anacor Pharmaceutical stock closed at $64.03 per share, up +2.59 or +4.22 percent in Friday’s regular trading session.

Stock Analysis

Palo Alto, California based Anacor Pharmaceuticals Inc. is a biopharmaceutical company founded in 2002.
The company was created around boron chemistry technology developed by Dr. Stephen Benkovic of Pennsylvania State University and Dr. Lucy Shapiro from Stanford University. Anacor’s two main drug candidates are Tavaborole (AN2690), an antifungal for the treatment of onychomycosis, an infection of the nail and nail bed which has been approved under the name Kerydin; and Crisaborole (AN2728), a topical ointment used in the treatment for skin conditions such as psoriasis and atopic dermatitis.

New York City based Pfizer Inc. is the largest pharmaceutical company in the world by revenue. Pfizer’s biggest products include Lipitor, used for lowering cholesterol, Diflucan, an oral antifungal medication, Viagra, for erectile dysfunction and Celebrex, an anti inflammatory drug. The company’s pipeline is an industry leader and is currently working on developing treatments for cancer and Alzheimer’s disease.

Under the terms of the agreement, a Pfizer subsidiary will commence a tender offer for all outstanding shares of Anacor common stock for $99.25 per share in cash. The closing of the transaction is subject to the customary closing conditions including clearance by U.S. antitrust regulators and is expected to be completed by the third quarter of this year.

The timing of the merger follows Anacor’s Crisaborole achieving statistically significant results on all primary endpoints in Phase 3 pivotal studies conducted in March of 2016. At the time, the FDA accepted Anacor’s New Drug Application for the drug in cases of mild to moderate atopic dermatitis in adults and children. Crisaborole was given a Prescription Drug User Fee Act (PDUFA) goal date of January 7th, 2017 for the FDA to complete its review.

Atopic dermatitis is a common inflammatory skin disorder with symptoms lasting up to two weeks. The condition affects 18 to 25 million people annually in the United States with as many as 18 percent being children. Pfizer estimates that, upon approval, Crisaborole peak sales could reach or exceed $2 billion.

Paul L. Berns, Anacor’s Chairman and Chief Executive Officer  said in this morning’s press release that, “Today marks the beginning of an exciting new chapter for Anacor, which we believe will deliver significant value to our shareholders. We have a deep respect for Pfizer, and it is clear that they share our commitment to addressing the significant unmet medical needs in inflammatory disease. We are proud of the innovative company that our team has built and are confident that Pfizer will help accelerate Anacor’s important mission given the strength of its global platform and resources.”

Pfizer expects to finance the deal with existing cash and does not expect the transaction to have an impact on the company’s 2016 guidance. The transaction is expected to be slightly dilutive to Pfizer’s 2017 adjusted diluted earnings per share with accretion to adjusted diluted earnings in 2018 and increasing thereafter.

Other News About ANAC

Anacor Pharmaceuticals Shares Rise Despite Q1 Loss

Company reported a net loss of -$0.36 per share on $17.5 million in revenue.

Edited Transcript of ANAC earnings conference call or presentation 10-May-16 12:00pm GMT

Anacor Pharmaceuticals held a post earnings conference with analysts and investors last Tuesday.

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Published on May 16, 2016
By Jay Hawk
Jay Hawk
Jay Hawk enjoyed a 12-year professional financial markets career incorporating extensive first hand futures and options experience obtained by trading in the stock, commodity and forex markets on U.S. exchanges. Since retiring as a full-time financial market professional, he has been actively trading stock, commodities, forex and options for his own account and managing funds for others, as well as writing financial market commentary and educational articles.

Copyrighted 2020. Content published with author's permission.

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