- In bad domino-effect fashion, a planned buyout of Targacept by Catalyst Biosciences has hit a major hurdle on the news that Pfizer has pulled the plug on its 2009 licensing agreement for Catalyst's lead drug candidate in development.
- On March 5, San Francisco-based Targacept and Catalyst Biosciences agreed to merge.
- The stock was intended to trade under the ticker CBIO, with Catalyst shareholders owning 65% of the company. Targacept shares are down to $2.53.
Mergers and acquisitions are a driving force in the pharma industry, but the underlying reality is that the largest companies have the most power.
In the case of Catalysts Biosciences, its R&D alliance with Pfizer geared towards the development of its lead drug candidate, CB 813d for treatment of hemophilia, enabled it to pursue a merger with Targacept, which focuses on development of neuronal nicotinic receptors, with a current focus on diabetic gastroparesis.
But now that Pfzier is no longer involved, the deal between the two smaller companies may not move forward after all. "[I]t is too early to know the implications" of the Pfizer-Catalyst split, said Targacept CEO Stephen Hill in a statement. The company is currently mulling its options regarding what effect the news may have on the planned merger.