Shares of migraine drug maker Biohaven soared nearly 70% after agreeing to be acquired by Pfizer for almost $11.6 billion in cash as the drugmaker expands its portfolio.
PFE up +0.37%, BHVN up +70.74%, premarket trading.
Under the deal, Pfizer will get access to Biohaven’s approved drug Rimegepant, which belongs to a class of migraine drugs referred to as calcitonin gene-related peptide (CGRP) inhibitors.
Pfizer accumulated a lot of cash on the back of success with its Covid-19 vaccine and oral drug Paxlovid, with investors expecting it to spend the cash on deals as it faces the loss of patent protection for key cancer drugs in the next few years.
Pfizer stated it will acquire all the outstanding shares of Biohaven that it does not already for own $148.50 per share in cash, a 78.6% premium on the company’s last closing price.
Biohaven shareholders will receive 0.5 of a share of a new publicly-traded company that will hold Biohaven’s non-CGRP treatments that are in the development phase.