Analysts see Mylan as likely target for Pfizer, as cooling-off period for new AstraZeneca bid ends

Analysts at Jefferies suggested that despite a six-month pause under UK takeover regulations coming to an end enabling Pfizer to renew its interest in AstraZeneca, the company's most likely acquisition target is Mylan. The analysts also named GlaxoSmithKline as "a wild card" option for Pfizer, after speculation first linked the two companies in August.

In May, Pfizer abandoned its bid to acquire AstraZeneca, with the UK drugmaker having rejected its offer of 55 pounds per share ($86.50), saying it undervalued the company and its prospects. Under UK takeover regulations, Pfizer was unable to propose another offer for AstraZeneca for a six-month period, which ended November 26.

According to Panmure Gordon analyst Savvas Neophytou, there is a 15 percent to 25 percent chance of a renewed bid. Since Pfizer ended its previous takeover attempt, the US government has introduced new legislation to curb tax-inversion deals, a key rationale of the drugmaker's bid to buy AstraZeneca. In addition, Pfizer recently entered a deal with Merck KGaA to jointly develop and market the latter's investigational anti-PD-L1 antibody MSB0010718C for multiple cancer types. Pfizer had previously cited experimental immuno-oncology drugs, including the anti-PD-L1 therapy MEDI4736, as part of its rationale for pursuing an acquisition of AstraZeneca.

Meanwhile, Actavis, which sources suggested had been approached earlier this year by Pfizer regarding an acquisition, recently agreed to buy Allergan for approximately $66 billion. For related analysis, see Spotlight On: Actavis as Pfizer's next takeout candidate – a good idea or the only alternative to AstraZeneca? and ViewPoints: New US tax rules may be no match for Pfizer's wanderlust.

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