Pfizer Inc. (PFE) Buys Hospira, Inc. (HSP) touts Complementary Products, International Revenue Stream


Pfizer Inc. (NYSE:PFE) recently announced that the company would acquire Hospira, Inc. (NYSE:HSP) in a $17 billion cash deal, which translates to $90 per share of Hospira. The deal represents nearly 40% premium to Hospira’s closing price of $64.80 on Wednesday.

Following the announcement, the stock of Hospira bounced to match-up the deal value and closed at $87.64 on Thursday, gaining 35.25% from its previous close. Pfizer’s stock gained 2.87% and closed at $32.99 on Thursday.

The deal has been approved by the Boards of both companies. The acquisition will help Pfizer further expand its broad pharma offerings with addition of Hospira’s sterile injectable treatments and biosimilar drugs.

Pfizer Inc. (NYSE:PFE) noted in a statement that Hospira, Inc. (NYSE:HSP)’s product line strategically complements with its own diversified portfolio and will also be a value addition to the international revenue stream.

Ian Read, Pfizer chairman and chief executive, expressed that Hospira’s operations aligns well with the company’s new commercial structure and is a strategic fit for its Global Established Pharmaceutical business. Hospira acquisition will also help enhance Pfizer’s product portfolio in growing markets.

In a joint statement, the companies mentioned that market for sterile injectables and injectable drugs could reach to about $70 billion in 2020. The significance of such pharmaceutical products is growing rapidly, given their applications in the treatment of a range of conditions from pain to cancer. The world market for biosimilars is also expected to cross $20 billion mark within the next five years.

Hospira, Inc. (NYSE:HSP) is global leader in injectable drugs and infusion technologies. The company had reported net sales of $1.2 billion for its Q3 ended September 30, 2014. The company’s net sales improved nearly 14% YoY, due to continued strong global sales of SIP (Specialty Injectable Pharmaceuticals) products.

Pfizer Inc. (NYSE:PFE) has recently reported its FY14 earnings of $1.42 per diluted share on revenues of $49.6 billion.

Lisa Ray

Lisa Ray primarily covers Retail and Healthcare. Lisa Ray has completed her MBA (Finance) and an avid market tracker. She is a stock market analyst who closely tracks US markets along with other global markets like India. She has been expressing her views for years about markets and also advises various clients.

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