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Pfizer offering $3.6B in cash for King Pharmaceuticals

NEW YORK — Pfizer Inc., the world’s largest pharmaceutical company by revenue, said today it will buy pain drug maker King Pharmaceuticals Inc. for $3.6 billion in cash.

Pfizer is paying $14.25 per share for King. That’s a premium of 40 percent to the stock’s yesterday closing price of $10.15. In the deal Pfizer gains products including the pain drug Avinza and EpiPen, a pre-filled injection designed to quickly treat serious allergic reactions.

The deal is Pfizer’s largest since it bought rival Wyeth for $68 billion in 2009. That deal closed last October.

King has struggled in recent years as patents on several of its key drugs have expired or been thrown out. But the Bristol, Tenn., company is heavily involved in developing pain drugs that are intended to be abuse-resistant. Abuse of pain drugs like oxycodone has become a major concern for health officials and regulators in recent years. The drugs are often crushed or dissolved to defeat their time-release mechanisms, allowing users to get high.

King’s Embeda is one pain treatment that is designed to resist abuse attempts. King plans to file new applications for two similar drugs in the next few months, filing for approval of Remoxy in the fourth quarter of 2010 and Acurox in the first quarter of 2011. Remoxy and Embeda are extended-release drugs, while Acurox releases its painkilling ingredient immediately.

King’s other products include the bleeding control drug Thrombin-JMI and the Flector pain patch.

The boards of both companies approved the deal. Pfizer said the purchase will add about 2 cents per share to its profit in 2011 and 2012, and 3 to 4 cents per share in each of the next three years.

In premarket trading, King shares soared to $14.13, up 39 percent from yesterday’s close. Pfizer shares dipped 3 cents to $17.35.

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