Pfizer and AstraZeneca’s complementary areas in R&D could create a pipeline with massive projected sales and a much larger oncology pipeline if the proposed deal were to go ahead.
According to research and consulting firm GlobalData, the potential consolidation of Pfizer and AstraZeneca would create a pipeline with overall projected sales of $10.8 billion in the next five years, while also creating an R&D juggernaut with aggregate expenditure of over $11 billion, overtaking current R&D spending leaders Novartis and Roche.
GlobalData says that if Pfizer’s takeover were to be successful, its position as the world’s largest pharmaceutical company would be cemented.
Joshua Owide, GlobalData’s Director of Healthcare Industry Dynamics, says that this deal would be unlike any other in Pfizer’s corporate evolution up until now, as the value would lie in Pfizer’s commitment to cultivate ongoing research and development activities at AstraZeneca.
Mr Owide said: “The proposed purchase of AstraZeneca appears to be a very complementary fit with Pfizer, especially given the latter’s plans to spin off some of the mature components of its prescription pharmaceutical business.
“AstraZeneca’s expiring drugs would meld into Pfizer’s Established Products division, and the former’s promising pipeline would bolster the other two Pfizer business units, which focus on new medications and consumer health, making them prime candidates for divestment.”
Pfizer and AstraZeneca both have complementary areas in R&D, and a merger would give Pfizer a much larger oncology pipeline in particular, thanks to the fold-in of AstraZeneca’s late-stage, anti-cancer agents. These include moxetumomab, olaparib and tremelimumab, a candidate developed by Pfizer and licensed to MedImmune.
AstraZeneca now boasts the most promising oncology pipeline in the industry, with projected 2019 revenues of $4.7 billion, ahead of Merck & Co. and Bristol-Myers Squibb. Furthermore, AstraZeneca is currently investigating compounds in 60 oncology indications across Phase I and Phase II trials, representing a significant strategic opportunity for Pfizer as the branded oncology market is forecast to grow by annual sales of $76.7 billion between 2013 and 2019.
Mr Owide said: “The potential gain that Pfizer could extract from AstraZeneca’s pipeline, in relation to other components of the combined business, shows that any value from its deal with AstraZeneca would be heavily tied to its ability to nurture the UK giant’s emerging pipeline.”