- Pfizer stock is climbing after it announced its intention to acquire ReViral for up to $525 million.
- The first-ever vaccine against RSV is undergoing phase 2 testing at ReViral.
What’s going on with Pfizer stock
Pfizer (NYSE:PFE) stock was climbing 4.3% at the closing bell on Thursday, while the broader market indexes were declining. The jump came after announcing intentions to acquire privately owned ReViral for $525 million.
Why we care
The takeover of ReViral was seen as a good match for Pfizer by investors. Firstly, Sisunatovir, is an experimental oral therapy for treating respiratory syncytial virus (RSV) infection. The development of the drug is included in the pipeline of ReViral. ReViral is currently evaluating sisunatovir in two phase-2 trials testing it against RSV in infants and adults.
Pfizer is developing a vaccine to prevent RSV based on its PF-06928316 compound. The experimental immunization is in late-stage testing. “The proposed acquisition of ReViral’s pipeline of therapeutic candidates is complementary to our efforts to advance the first vaccine candidate to help protect against this harmful disease,” Annaliesa Anderson, Pfizer’s chief scientific officer for bacterial vaccines and hospital unit, stated.
Investors probably praised the deal’s structure as well. Pfizer isn’t paying $525 million upfront to acquire ReViral. Instead, the overall amount consists of payments contingent on reaching certain development milestones. Thus, reducing Pfizer’s exposure to the transaction. ReViral aims to generate at least $1.5 billion in peak sales with its therapies, according to Pfizer.
Pfizer’s acquisition of ReViral is subject to regulatory clearances. However, there are high expectations for a smooth path to closing the transaction, as evidenced by today’s nice move for the extensive pharmaceutical stock. In addition, Pfizer will almost certainly make additional purchases this year, given that its cash surplus is increasing as a result of the COVID-19 program income. Moreover, given the new pending acquisition and ongoing COVID-19 vaccination booster program, Pfizer appears to be a recession-resilient stock.