Pfizer To Buy Cancer Drug Firm Medivation For £10bn

US pharmaceutical giant Pfizer (NYSE: PFE - news) has announced that it will buy Californian biotechnology company Medivation (NasdaqGS: MDVN - news) in a deal valued at $14bn (£10.7bn).

The proposed acquisition, which was first rumoured back in May 2016, was confirmed by Pfizer in a post on its website on Monday.

It will see each Medivation share priced at around $81.50 - a 21% increase on the company's closing stock price on Friday.

The company's shares were up 19% to $80.01 in pre-market trading on Monday off the back of the news.

Medivation is best known for developing drugs to tackle cancer - most notably the prostate cancer drug Xtandi - and will allow Pfizer to expand its oncology portfolio.

One of Pfizer's most well-known drugs is the anti-impotency product Viagra.

The acquisition was approved by the boards of both companies and is expected to be completed in the third or fourth quarter of this year.

Ian Read, chairman and chief executive of Pfizer, said: "The proposed acquisition of Medivation is expected to immediately accelerate revenue growth and drive overall earnings growth potential for Pfizer.

"The addition of Medivation will strengthen Pfizer's Innovative Health business and accelerate its pathway to a leadership position in oncology, one of our key focus areas, which we believe will drive greater growth and scale of that business over the long-term."

David Hung, founder and chief executive of Medivation also praised the deal.

He said: "We believe that Pfizer is the ideal partner to extend the reach of our blockbuster Xtandi franchise and take our promising, late-stage assets - talazoparib and pidiluzimab - to their next stages of development so that they can be made available to patients as quickly as possible."