Novo Nordisk’s $10 Billion Bid Ups the Ante in Bidding War for Obesity Biotech Metsera

Metsera is getting Helen of Troy treatment from its suitors. 

The weight-loss biotech firm agreed to a $7.3 billion takeover by Pfizer in September, but that isn’t stopping it from entertaining more offers. On Tuesday, Novo Nordisk raised its bid to stop the Pfizer-Metsera marriage to $10 billion from an original $9 billion, which it offered just a week ago. Pfizer’s response? A legal challenge, a plea to Metsera that a deal with Novo Nordisk will never fly with antitrust regulators … and an increased bid of $8 billion.

Metsera Sera

Even if Pfizer prevails, the relationship will likely require some healing. A day after Novo’s initial bid, Pfizer filed a lawsuit against the boards of both Novo and Metsera, alleging a breach of contract. (On the same day, the Federal Trade Commission gave the green light to its $7.3 billion takeover, which was agreed to on September 22.) Then on Monday, Pfizer filed a second lawsuit against the two firms, alleging an “anticompetitive conspiracy” in violation of the Sherman Antitrust Act.

The heated competition is hardly surprising. Metsera may have no approved drugs yet, and fewer than 100 employees, but its pipeline includes promising pills for weight loss, a slice of the industry quickly falling under competitor Eli Lilly’s control. Metsera on Tuesday called Novo’s new $10 billion offer the “superior” bid, but Pfizer has two more business days to come to a new agreement with the company. As the bidding war rages on, a judge has already delivered Pfizer a message in its legal fight for Metsera: Que sera sera, or whatever will be, will be:

• “My strong sense [is] that it would be wrong for this court to inject itself into [an] ongoing topping process that is creating value for Metsera stockholders,” Morgan Zurn, vice chancellor of the Delaware Court of Chancery, said in an emergency hearing over the case on Tuesday. A follow-up hearing is scheduled for today.
• The judge is, unsurprisingly, correct: Novo’s Tuesday bid values Metsera at up to $86.20 per share, a 159% premium to its closing price on the day before Pfizer’s initial offer in September.

Up, Up and Away: What’s more, Metsera’s stock climbed 20% on the bidding war news on Tuesday, closing at $73.18 per share. That’s above Pfizer’s initial $68.43 per-share offer as well as its current $70 per-share bid. Mizuho Securities healthcare strategist Jared Holz told Bloomberg that it’s a sign Wall Street might be anticipating even higher bids to come. As Helen of Troy could tell you, it’s nice to be wanted, but it’s also complicated.