Pfizer Turns to JPMorgan to Explore $2 Billion Sale of Certain Assets

February 2, 2017
By Alex Keown, BioSpace.com Breaking News Staff

NEW YORK – Pfizer could be looking to sell off a number of non-core assets in cardiology, urology and primary care in order to raise cash and streamline its portfolio, Bloomberg reported, citing people familiar with the matter.

The drugs Pfizer could sell off generate sales of more than $700 million annually and could command more than $2 billion from a potential buyer. According to Bloomberg, Pfizer has secured the services of J.P. Morgan Chase & Co. to assist with the possible sale. Neither Pfizer nor J.P. Morgan commented on the possible sale.

Earlier this week, Pfizer said it anticipated more generic competition throughout 2017. Despite those challenges, or because of them, Pfizer said it would continue to flex its M&A muscle as long as it creates shareholder value, Bloomberg said in its report on Pfizer’s fourth-quarter earnings report. During a conference call with reporters, chief executive officer Ian Read said that possible changes in the U.S. tax code under the administration of President Donald Trump might make some deals more financially palatable to the company. Potential deals could generate more jobs and revenue, Read said. However, during the conference call, Read said it was unlikely that Pfizer would wait to see if Trump’s proposed tax cuts are enacted and would strike quickly if the right deal came along, which could be a possible hint the company already has its sights set on a potential deal and doesn’t want to wait. Some think Pfizer could be looking at acquiring Bristol-Myers Squibb , which slashed its earnings projections for 2017, due in part to stumbles by its lead PD-1 inhibitor Opdivo.

Although Pfizer was unable to merge with Allergan due to new tax rules, the company remained busy last year with acquisitions, including deals to acquire Anacor Pharmaceuticals and Medivation .

While the deals could spur new revenues for Pfizer, the company has hopes that its pipeline will spin out five drug approvals over the next year. During the conference call, Mikael Dolsten, Pfizer’s president of worldwide research and development, touted one drug, avelumab, a PD-L1 inhibitor for the treatment of metastatic Merkel cell carcinoma. Dolsten said the U.S. Food and Drug Administration is expected to rule on avelumab later this year.

Earlier this week, Pfizer announced it had cancelled three pipeline programs: PF-06291874, in Phase II trials for type 2 diabetes, PF-06815345 in Phase I for hyperlipidemia, and PF-06412562 for cognitive disorder.

While the company has hopes for its five experimental drugs, Pfizer is also hoping some of its newer drugs will offset flagging sales in older ones that are being challenged by generics. Drugs the company is hoping will continue to be strong revenue drivers include breast cancer drug Ibrance, which is Pfizer’s fastest-growing drug. In 2016, Ibrance generated $2.1 billion in sales, which was a massive jump from $723 million the drug brought in in 2015. The drug received an expansion approval by the FDA last year.

Another drug the company is seeing strong growth in is the anticoagulant Eliquis. Co-developed with Bristol-Myers Squibb , Eliquis was initially approved to cut stroke and blood clotting risk in patients with non-valvular atrial fibrillation. It has expanded for use in hip or knee replacement patients, and patients with risk of deep vein thrombosis and pulmonary embolism. Eliquis generated $1.59 billion globally last year, a 50 percent growth over 2015.