Pfizer to snap up King Pharma for $3.6 bn

Pfizer Inc today said it will acquire King Pharmaceuticals in an all-cash deal worth $3.6 billion, a move that will bolster the pharma major's presence in the pain treatment segment.

Both companies have entered into a definitive pact for the transaction, which has been approved by the firms' boards.

In a statement, Pfizer said it would buyout King Pharmaceuticals for $3.6 billion in cash, translating into a share price of $14.25 apiece, which represents a 40 per cent premium over the company's cosing price on October 11.

Subject to various regulatory approvals, the transaction is expected to close in the fourth quarter of 2010 or the first quarter of 2011.

King Pharmaceuticals is a diversified specialty pharmaceutical discovery and clinical development company.

"This strategic combination will allow Pfizer to leverage its existing commercial capabilities and expertise to create one of the leading broad portfolios for pain relief and management in the bio-pharmaceutical industry...," it said.

The acquisition would bring pain treatment drugs such as Avinza, Flector Patch and Embeda into Pfizer's portfolio. Pfizer's current offerings in this segment include Lyrica and Celebrex.

King Pharmaceuticals' Meridian auto-injector business for emergency drug delivery is a long-term supplier to the US Department of Defence, while its animal health business offers a variety of feed additive products for various species.

Noting that the combination would be "highly complementary", Pfizer Chairman and Chief Executive Jeffrey Kindler said it would help the company offer a fuller spectrum of pain relief and management remedies globally.

"The market for pain relief and management treatments is increasing, with physicians in the US writing approximately 320 million prescriptions to treat pain in 2009," the statement noted.