Pfizer’s Latest Acquisition: Smart Move or Desperate Gambit?

Pharma giant Pfizer just placed another billion-dollar bet—but will this acquisition actually deliver shareholder value or simply inflate executive egos?

The Deal Breakdown

Pfizer's acquisition strategy continues its aggressive expansion beyond traditional pharmaceuticals. The company snaps up innovative biotech firms faster than Wall Street analysts can update their spreadsheets.

Market Reaction

Early trading shows mixed signals—typical Wall Street confusion where nobody wants to be first to call a winner or loser. The street remains divided between bulls seeing strategic vision and bears spotting another costly diversification attempt.

Long-Term Implications

This move either positions Pfizer for explosive growth in emerging therapies or becomes another case study in corporate bloat. Because nothing says 'innovation' like throwing money at problems instead of developing organic solutions.

Bottom line: Pfizer keeps playing acquisition roulette while retail investors foot the bill—the house usually wins, but this time might be different. Or not.

Image source: Getty Images.

COVID recedes

The drugmaker stock has languished since COVID peaked, as demand for its vaccines and related drugs waned. While still around, the threat of COVID has fallen off, with the virus causing far fewer deaths and hospitalizations today. New cases of the virus have fallen off precipitously and their severity with them.

If that wasn't enough of a knock for the drugmaker (though admittedly a boon for humanity), several of Pfizer's other major drugs are nearing the end of their patent lives, including Eliquis for blood clots and Ibrance for breast cancer, among others.

After hitting a high of almost $60 in December 2021, the stock has fallen back to Earth and is now trading at around $24. Investors clearly want to see something new from Pfizer.

Another pandemic

Well, that something may have arrived, and just in time to treat what is considered a very different kind of pandemic for humanity, and a growing one: Obesity. (To be sure, obesity is a significant risk factor for COVID-19, too.)

Two major pharmaceutical firms already manufacture treatments for obesity, and they're considered generally SAFE and effective. These drugs are known as GLP-1 drugs and have names that many people might be familiar with these days, including Wegovy and Saxenda, made by Danish firm(NVO -2.72%), and Zepbound, made by(LLY -0.55%).

Last year, Novo Nordisk sold $9.9 billion of Wegovy and Saxenda, while Eli Lilly brought in $4.9 billion from Zepbound. Demand for and sales of the weight loss drugs is only expected to accelerate, and the size of the obesity drug market is forecast to hit $100 billion within five years.

More than 40% of Americans are affected by obesity. And the condition is no longer limited to wealthy nations. It is rising in poorer countries as they shift from traditional diets to processed foods high in sugar, fat, and calories.

Pfizer arrives

But -- finally -- Pfizer is getting into the obesity drug game. This past week, the company announced it will acquire Metsera, a clinical-stage biopharmaceutical firm that is developing several obesity drugs. The price of the acquisition is $4.9 billion.

One of Metsera's drug candidates, known as MET-233i, can be taken less frequently than the Novo Nordisk and Lilly drugs and has proven highly effective -- it helped patients in one study to lose 8.4% of their body weight in 36 days.

To be sure, Metsera's drugs are still in development. But with Pfizer's stock price down almost 9% year to date (from Jan. 1, 2025), now may be the time to buy. The stock is trading at just 7.7 times forward earnings, while Novo Nordisk is at 14.5 forward earnings and Lilly is trading at 25 times earnings.

That makes Pfizer very cheap by comparison. There are no guarantees in investing, but investors looking to profit on the rapidly rising popularity of obesity drugs at a reasonable price need to look at the stock now. An investment of $1,000 in Pfizer today may pay off handsomely in the coming months and years.