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Novo Nordisk’s bid to gatecrash Pfizer’s takeover of weight-loss biotech Metsera is coming under pressure, as the US pharmaceutical company sued its Danish rival and won early approval from antitrust authorities for its original deal.
In the first signal that Washington could weigh in on the dramatic public battle for one of the most coveted weight-loss biotechs, the US Federal Trade Commission on Friday gave an early greenlight for Pfizer’s deal, an especially significant move as the government is shut down.
The move from the antitrust watchdog came shortly before Pfizer launched a lawsuit against the boards of Novo and Metsera in Delaware court in an attempt to block the competing bid, accusing the Ozempic maker of trying to sabotage its agreed takeover and evade antitrust scrutiny.
The latest salvo in the battle to take over Metsera suggests the Trump administration is closely following the transaction and could step in to support the US pharma company’s attempt to secure a much sought after obesity drug, according to people familiar with the matter.
President Donald Trump has been increasingly interventionist in mergers and acquisitions since re-entering office this year as he has used deal approval processes to support his America First agenda, including securing a “golden share” in US Steel as a condition to give the go-ahead to its takeover by Japan’s Nippon Steel. The US government also took a stake in chipmaker Intel.
Pfizer is already in Trump’s good graces thanks to its White House pricing agreement announced last month and the launch of the TrumpRx drug platform. Chief executive Albert Bourla has been courting the US president with multiple visits to the White House and Mar-a-Lago.
Novo on Thursday unveiled an unsolicited bid valuing Metsera at up to $9bn, which the US biotech’s board deemed “superior”. In a statement accompanying its lawsuit, Pfizer, which had struck an up to $7.3bn deal with Metsera in September, argued that Novo’s interloper deal was “illegal”.
“The proposed Novo Nordisk transaction is an illegal attempt by a company with a dominant market position to suppress competition and uses an unprecedented structure designed to deliberately evade antitrust review,” Pfizer said in a statement.
In the lawsuit Pfizer said: “Novo Nordisk’s proposal is nothing more than an old-fashioned bribe of Metsera and its key stockholders to not compete against Novo Nordisk.” Pfizer is seeking a stay on Novo’s deal as well as damages.
As part of its takeover proposal, Novo offered to pay Metsera $6.5bn almost immediately after signing, an unusual two-step deal structure which Pfizer argued was created to evade Novo’s antitrust risk as one of the two dominant players in the weight-loss drug market.
Novo has fallen behind Eli Lilly in its battle to dominate the lucrative weight-loss drug market, and under a newly-installed chief executive is beginning to pursue deals more aggressively. Novo previously bid on Metsera before Pfizer sealed its deal in September.
Meanwhile, Pfizer’s move for Metsera is aimed at giving the struggling US drugmaker a crucial foothold in the obesity drug market, after its weight-loss medicine being developed in-house flopped in clinical trials earlier this year.
Metsera has four clinical trials under way for obesity drugs, including a long-acting monthly injectable and a pill, giving them a competitive advantage compared with existing weight loss treatments.
Pfizer issued a statement Friday afternoon saying the FTC “has granted early termination of the waiting period” under Hart-Scott-Rodino review ahead of an early November deadline, clearing a crucial hurdle in antitrust regulators’ review of any deal.
Due to a reduction in funding as a fallout of the US government shutdown, the FTC previously said it would not grant so-called early termination notices for antitrust reviews of deals, but an exception was made for the Pfizer-Metsera deal.
Novo said late on Friday that Pfizer’s allegations were meritless, adding “we will vigorously defend ourselves in any litigation”.
Metsera said it “disagrees with the allegations in Pfizer’s complaint” and would address them in court.
Evan Seigerman, head of healthcare research at BMO Capital Markets, said in a note that Pfizer’s lawsuit “escalates already tense rhetoric between them and Novo”, adding that “biopharma M&A has never been more contentious in recent memory”.
He added in an earlier interview: “We know Trump talks about ‘America First’ and I don’t see a situation where Trump wants his FTC to approve such a deal between Novo and Metsera.”
Pfizer’s shares closed up 1.4 per cent on Friday, while shares in Metsera were down 1.1 per cent on the news. The FTC did not immediately respond to requests for comment.
This article has been amended to reflect that Novo offered to pay Metsera $6.5bn, not $5bn, as part of its takeover proposal
