Pfizer a Step Closer to Icagen - Analyst Blog

Pfizer Inc. (PFE) is close to completing its acquisition of Icagen, Inc. (ICGN). The company recently announced the expiration of the subsequent offering period of the cash tender for all of the outstanding shares of common stock of Icagen.

With the expiry of this period, Pfizer now holds 70.2% of the outstanding shares of Icagen.

Per the terms of the merger agreement, Pfizer will carry out a second-step merger following which Icagen will become a wholly-owned subsidiary of the company.

Agreement Announced in July

Pfizer had first announced its intention to acquire Icagen in July 2011 for $6 per share. The total value of the deal, including the value of the shares already owned by Pfizer, is about $56 million.

Earlier in August 2007, Pfizer and Icagen had entered into a collaboration for the discovery, development and commercialization of compounds that modify three specific sodium ion channels that are to be used as potential treatments for pain and related disorders. With the Icagen deal, Pfizer is looking to add to its already diversified product portfolio. Icagen currently has two programs in epilepsy and pain.

Neutral on Pfizer

We currently have a Neutral recommendation on Pfizer, which carries a Zacks #3 Rank (short-term Hold rating). While near-term earnings growth will come in the form of cost cutting and share repurchases, longer-term growth will be dependent on the success of drug development. The company will face additional challenges later this year with the loss of US exclusivity on Lipitor in November.

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