Novo ups bid to $10B in Metsera fight with Pfizer

Novo Nordisk is raising the stakes in its push to outbid rival Pfizer and acquire the development-stage drugmaker Metsera.

Novo is now offering to pay as much as $10 billion for the company, Metsera said Tuesday. That’s higher than its previous bid of up to $9 billion which sparked a lawsuit from Pfizer.

Pfizer also has altered the offer it made in September of nearly $4.9 billion to provide more cash up front, Metsera said.

Novo is now proposing to pay $62.20 in cash for each Metsera share, up from its previous bid of $56.50. The Danish drugmaker also will tack on a contingent value right payment of $24, another improvement from its previous bid, if certain development and regulatory milestones are met.

But Novo is essentially structuring the deal to require some payback from Metsera.

Novo is proposing a two-step process where it would pay Metsera $62.20 per share in cash. Metsera would issue Novo non-voting preferred stock representing half of Metsera’s share capital. Metsera would then declare a dividend of $62.20 per common share with a record date ten days after the companies sign the deal, with payment following.

Metsera said Tuesday that the new Novo bid is superior to its existing agreement with Pfizer, and Pfizer now has a window to negotiate on its deal.

Pfizer Chairman and CEO Albert Bourla told analysts Tuesday morning that the Novo offer was “illusory” and cannot constitute a superior offer. He said that there is a high regulatory risk it won’t be completed.

“It is an illegal attempt by a foreign company to do an end run around antitrust laws, taking advantage of the (federal) government shutdown,” Bourla said during a conference call to discuss Pfizer’s third-quarter results.

He added that Novo wants to “cut and kill an emerging competitor.”

A Novo representative called Pfizer’s claim baseless and said its offer, including the structure, complies with with all applicable laws.

Metsera Inc., based in New York, has no products on the market, but it is developing oral and injectable treatments. That includes some potential treatments that could target lucrative fields for obesity and diabetes.

Novo already has a significant stake in the market for diabetes and obesity treatments. Its products include Wegovy and Ozempic.

Pfizer Inc., also based in New York, is attempting to build its own stake in that market several months after ending development of a potential pill treatment for obesity.

Metsera said Pfizer proposed on Monday to pay $60 per share up front in cash, up from the $47.50 it proposed initially. But Pfizer reduced the contingent value right payment in its deal to $10 from $22.50.