GBT shares soar on rumors Pfizer could buy it for $5 billion

rumors that Pfizer (PFE) is in “advanced talks” to acquire world blood therapy (GBT) for around $5 billion sent GBT shares soaring for the second day in a row on Friday.




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Global Blood Therapeutics makes a sickle cell disease treatment called Oxbryta for patients ages 4 and older. According to the Wall Street Journal, Pfizer is set to finalize the Global Blood deal in the coming days. However, there are other suitors in the mix, and the deal is not set in stone. Pfizer representatives did not immediately return a request for comment. A GBT spokesman declined to comment.

GBT shares have soared this week on the rumours, first reported Wednesday by Bloomberg. Shares rose more than 41% on Thursday, breaking out of a long consolidation with a buy point of 40.79, according to MarketSmith.com.

In today’s stock market, shares were up another 33% at 63.84. Pfizer shares fell 1.2% to 49.27.

GBT Stock: Rare Disease Efforts

Global Blood Therapeutics was founded in 2011. It sells Oxbryta for the treatment of sickle cell disease and has two other promising treatments in early human trials. Recent efforts are also in sickle cell disease and in vaso-occlusive crises, a complication of sickle cell disease.

In the June quarter, GBT stock analysts expect Oxbryta to have generated more than $64 million in sales. Global Blood Therapeutics is on deck to report its second-quarter earnings on Monday.

Buying Global Blood would bolster Pfizer’s efforts in rare diseases. Today, that portfolio includes, above all, Vyndaqel. Vyndaqel treats a disorder in which abnormal proteins build up in the heart. In the second quarter, Vyndaqel generated $552 million in sales. The entire rare disease business generated $909 million in sales, growing by just 2%.

Vyndaqel is also likely to face competition in the near future. Alnylam Pharmaceuticals (ALNY) and Intellia Therapeutics (NTLA) are among those seeking to treat the same disease. So there is pressure to add to that portfolio. Rare diseases represented just 3% of Pfizer’s total revenue in the June quarter.

Pfizer has money to spend

Analysts have been after Pfizer to become more acquisitive. His Covid vaccine and antiviral pill have been big moneymakers. Pfizer expects revenue of $54 billion this year between the two products alone, the fruits of which it could invest in acquisitions such as GBT shares.

Earlier this year, Pfizer agreed to buy the migraine drug assets of biohaven pharmaceuticals (BHVN), invested $25 million in Akero Therapeutics (AKRO) and partnered with Roivant Sciences to launch Proivant Therapeutics in autoimmune diseases.

But sickle cell disease is an attractive market. Researchers now understand the cause of the disease. Crisp Therapeutics (CRSP) and Vertex Pharmaceuticals (VRTX) are also working on a gene editing approach.

GBT shares, however, remained range bound until this week. The stock now has a relative strength rating of 98 out of a possible 99 best. This places its 12-month performance in the top 2% of all stocks in terms of share price performance, according to IBD Digital.

Follow Allison Gatlin on Twitter at @IBD_AGatlin.

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