This is the largest acquisition in the biopharmaceutical industry since June 2019, when AbbVie bought Allergan for $63 billion. Before that, just five months earlier, the largest deal in the industry's history was Bristol Myers Squibb's acquisition of Celgene for $74 billion. While the boards of both companies gave unanimous approval, the transaction has yet to be reviewed by regulators.
Long considered one of the most attractive targets in the biotech industry, Seagen boasts four commercial drugs and additional antibody-conjugated drug candidates (ADCs). As a pioneer in ADC technology, Seagen has been instrumental in the development of four of the twelve ADCs that have been approved by the FDA and marketed throughout the industry to date. ADCs are a revolutionary therapeutic method that has become a potent weapon in the fight against a wide range of cancers, with the ability to selectively destroy cancer cells while minimizing damage to healthy cells.
Seagen expects to generate revenue of approximately $2.2 billion in 2023, a 12% year-over-year increase, from its four current drugs, royalties and licensing agreements. Pfizer believes Seagen has the potential to generate more than $10 billion in annual revenue by 2030, with the potential for significant growth.
Pfizer's sales of Covid-19 vaccines and drugs have recently increased financial results significantly. However, executives admitted that they cannot expect the same level of sales in the future as the pandemic moves into an endemic phase. The company therefore intends to use its tens of billions of dollars in Covid-19 vaccine revenues to close strategic deals.
Pfizer and other pharmaceutical companies became interested in Seagen because of the promise of ADC. Last year, Merck & Co. reportedly engaged in talks to take over Seagen, but the negotiations collapsed at a price reportedly around $40 billion.