Pfizer Expands Cancer Platform With High-Priced Medivation Acquisition
Despite the high price paid, we don't expect any major changes in Pfizer's fair value estimate.
Following
Despite the high price point for Medivation, we believe Pfizer can leverage Medivation's cancer drugs more effectively through Pfizer's strong distribution channels. Further, Pfizer's large size dilutes the minor overpayment. From a strategic standpoint, the deal strengthens Pfizer's growing oncology franchise, and we remain confident in the company's wide moat.
As pricing power has eroded in several therapeutic areas, cancer drugs have continued to support robust prices, which we believe further propelled Pfizer's decision to acquire Medivation. The importance of strong pricing power likely led several other bidders, including
Morningstar Premium Members gain exclusive access to our full analyst reports, including fair value estimates, bull and bear breakdowns, and risk analyses. Not a Premium Member? Get this and other reports immediately when you try Morningstar Premium free for 14 days.
United States