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Pfizer to buy Esperion for $1.3bn


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NEW YORK (Reuters) -- U.S. pharmaceuticals giant Pfizer says it has agreed to buy Esperion Therapeutics for about $1.3 billion, adding a promising experimental drug to its top selling line of cholesterol products.

The purchase puts Pfizer in a position to have three blockbuster cholesterol medicines on the market: Lipitor, Esperion's ETC-216 and Pfizer's own experimental cholesterol drug, which company executives believe could top Lipitor's $10 billion in annual sales.

Esperion's drug, which raises "good" cholesterol and has completed midstage clinical trials, is the only medicine ever shown to reverse clogging of the heart arteries. Esperion has three other cholesterol products in early trials that could also bolster Pfizer's line-up.

"This acquisition fits (Pfizer) like a glove," said Mark Monane, analyst at Needham & Co. "Esperion had all the characteristics of a takeover target: positive data from clinical trials and it had not yet partnered with another company."

Pfizer, the world's largest drug maker, said it will pay $1.3 billion in cash, or $35 per share, in the deal, which is subject to certain conditions.

The price represents a 54 percent premium over Esperion's average closing share price during the past 20 trading days. But the biotechnology stock has more than tripled this year on the positive trial results for its new cholesterol drug.

The deal could help get the groundbreaking Esperion drug to market quicker, thanks to Pfizer's massive research muscle, company executives said in an interview Sunday.

"Some people had predicted we would launch our drug by 2008, but with the size and resources of Pfizer there is a chance we could do it in a more timely way," said Roger Newton, Chief Executive of Esperion, who will stay on and head up Pfizer's new Esperion division.

Pfizer already owns Lipitor, a member of the statin family of cholesterol lowering agents, which works by lowering "bad" LDL cholesterol. Esperion's drug, by contrast, mimics "good" HDL cholesterol.

Esperion made a splash in early November, when it reported, in the Journal of the American Medical Association, that its drug reduced build up of fatty plaque in arteries by over 4 percent in patients, who were given weekly injections of the experimental medicine over a course of only five weeks during a Phase II trial.

Pfizer already had an option to co-market the medicine, which it obtained through its recent merger with Pharmacia Corp.

The experimental Esperion drugs are designed to be used intravenously after a heart attack or a major coronary event. By contrast, Pfizer's own experimental HDL drug, to be combined as one pill with Lipitor, would be taken daily for chronic conditions.

Pfizer research chief John LaMattina believes patients will use Esperion's ETC-216 in an emergency setting, and then will follow up with long-term usage of a combination of Lipitor and Pfizer's own HDL-raising drug, called torcetrapid.

"We feel all these drugs are complimentary, and that patients will need a variety of treatment options," LaMattina said in an interview.

Last month, Pfizer senior vice president of science and technology Peter Corr told Reuters the company plans to spend $800 million on its ongoing late-stage trial of the combination product, a record for a Phase III study of an experimental drug. Pfizer could seek U.S. approval of the drug within a few years, he said.

Esperion shares, which began 2003 at $6.63 and reached an all-time high of $26.56 November 6 following release of the ECT-216 trial results, closed at $22.70 Friday on Nasdaq.

Pfizer, which is traded on the New York Stock Exchange, closed Friday at $34.27



Copyright 2003 Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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