Bidding War Intensifies as Novo Nordisk Challenges Pfizer's Acquisition of Metsera

In a stunning turn of events, Novo Nordisk has launched an unsolicited bid to acquire obesity drug developer Metsera, challenging Pfizer's previously announced acquisition agreement. The move has sparked a high-stakes bidding war between two pharmaceutical giants, with potential implications for the future of obesity treatment and antitrust concerns in the industry.

Novo Nordisk's Surprise Offer

Novo Nordisk announced an unsolicited proposal to acquire Metsera for $6.5 billion in upfront consideration, with the potential to reach $9 billion including contingent payments. This offer significantly outbids Pfizer's original agreement, which valued Metsera at $4.9 billion upfront with potential milestone payments bringing the total to $7.27 billion.

Metsera's board has deemed Novo Nordisk's offer "superior" to Pfizer's, triggering a four-day window for Pfizer to counter. The Danish pharmaceutical company's bid includes $56.50 per share in cash plus $21.25 in contingent value rights (CVRs) to be paid at the close of the deal.

Pfizer's Response and Legal Action

Pfizer has strongly contested Novo Nordisk's bid, calling it a "reckless and unprecedented proposal" and an attempt to "suppress competition in violation of law by taking over an emerging American challenger." The company has filed two lawsuits in response:

1. A suit in the Delaware Court of Chancery against Metsera and Novo Nordisk, alleging breach of contract, breach of fiduciary duty, and tortious interference.

2. A separate lawsuit in Delaware District Court claiming Novo Nordisk engaged in anticompetitive action.

Pfizer argues that Novo Nordisk's offer is "illusory" and cannot qualify as a superior proposal due to significant regulatory risks. The company has requested a temporary restraining order to block Metsera from terminating their existing agreement.

Antitrust Concerns and Regulatory Scrutiny

The bidding war has raised significant antitrust concerns, particularly given Novo Nordisk's dominant position in the obesity drug market. Pfizer CEO Albert Bourla described Novo's offer as "an illegal attempt by a foreign company to do an end run around antitrust laws."

The U.S. Federal Trade Commission (FTC) has expressed concerns about the structure of Novo Nordisk's offer. In a letter to lawyers for both Novo and Metsera, the FTC suggested that the proposed upfront payment for half of Metsera's shares could violate the Hart-Scott-Rodino Premerger Notification Act.

Implications for Obesity Drug Development

The intense competition for Metsera underscores the growing importance of the obesity drug market. Metsera's pipeline includes promising candidates such as MET-097i, a phase 2b injectable GLP-1 receptor agonist that could support monthly dosing, and an oral GLP-1 designed to drive more weight loss than small molecules.

For Pfizer, acquiring Metsera represents a strategic move to re-enter the obesity space following setbacks in its internal weight loss portfolio. Novo Nordisk, already a leader in obesity treatment with its blockbuster drug Wegovy, sees the acquisition as an opportunity to expand its portfolio and maintain its dominant market position.

As the situation continues to unfold, the outcome of this high-profile bidding war could have far-reaching consequences for the pharmaceutical industry, particularly in the rapidly growing field of obesity treatment.