Pfizer's $11.6 billion Biohaven buy could spark more biotech deals
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(Reuters) - Pfizer Inc's (PFE)
The deal, announced on Tuesday, is the biggest in the sector so far this year and ends a dearth of large acquisitions, which along with clinical failures and investor exits following a gradual easing of the pandemic have pummeled biotech stocks.
"One weight on the sector has been a relative lack of M&A of late ... and we think this news may be just what the doctor ordered to restore sentiment," Piper Sandler analyst
Biotechs are coming off their worst April since 2002, and the crash in valuation has made them attractive M&A targets, especially when small drugmakers are grappling with a cash crunch, analysts say.
Graphic: Biotech index on track to give up most of its pandemic gains - https://fingfx.thomsonreuters.com/gfx/mkt/klvyklwxovg/Biotech%20index%20chart.JPG Wells Fargo analyst
The companies did not immediately respond to Reuters requests for comment.
Pfizer (PFE) offered a 78.6% premium, or
Drugmakers that benefited from their COVID-19 products such as Moderna Inc (MRNA) and BioNTech have also signaled that they have enough cash for deals.
Moderna (MRNA) ended the first quarter with a cash of
But there has not been "a fundamental shift in seller expectations as of this point," Merck & Co Inc (MRK) Chief Executive Officer
"There are some smaller players that do have cash challenges. That's where you could see movement first."
(Reporting by