-By Youssef El Madani, University College London
DEAL OVERVIEW
Acquirer: AstraZeneca
Target: Alexion Pharmaceuticals
Total Transaction Size: $39 billion
Closed date: July 21th 2021
Financial advisor to AstraZeneca: BofA Securities
Financial advisors to Alexion: Evercore Partners, Centerview Partners
In the largest deal of its history and the third-largest of 2020, pharmaceutical giant AstraZeneca has acquired rare diseases specialist Alexion for $39 billion cash-and-stock. After being almost taken over by Pfizer six years ago, AstraZeneca closed a successful acquisition that would deliver the British firm a lucrative portfolio of immunology medicines and a considerable presence in rare diseases. After some concerns that it could become a target for the FTC, the deal was approved by the United States back in April and by the UK’s Competition and Markets Authority a week before the closing announcement.
COMPANY DETAILS
Acquiring company: Astra Zeneca

AstraZeneca is a British-Swedish biotechnology company, headquartered in Cambridge and founded in 1999 after the merger of the British Zeneca Group and the Swedish Astra AB. With over 76000 employees, it is among the world’s largest pharmaceutical companies and has been involved in developing a COVID-19 vaccine. It has portfolio of products for major diseases in various areas such as neuroscience, respiratory, cardiovascular and oncology.
CEO: Pascal Soriot
Number of employees: 76100 (2020)
Market Cap: $ 182.37 billion (as of 05/09/2021)
EV: $ 168.65B billion
LTM Revenue: $ 29.53B billion (June 30, 2021)
Target company: Alexion Pharmaceuticals

Alexion Pharmaceuticals is an American biopharmaceutical company that specialises in orphan drugs to treat rare diseases. Its products generated more than $6 billion in revenues in 2020. Its portfolio of drugs treats rare diseases such as atypical hemolytic uremic syndrome, paroxysmal nocturnal hemoglobinuria and lysosomal acid lipase deficiency. The drugs that treat these diseases are some of the most expensive drugs worldwide (as much as $2 million per year).
CEO: Ludwig N. Hantson
Number of employees: 2525 (2020)
Market Cap: $ 40.33 billion (September 2021)
LTM revenue : $6.26 billion (last quarter: Q1 2021)
RATIONALE
Back in 2014, after a takeover attempt by Pfizer, AstraZeneca’s CEO Soriot set the objective of doubling the company’s revenues to about $40 billion by 2023. With revenues of just $20 billion in 2019, it is a target the company is unlikely to meet through organic growth alone. Thus, by securing two of Alexion’s main drugs, Soliris and Ultomiris, AstraZeneca would secure an immediate $6 billion bump in revenues and get closer to the $40 billion threshold. By mid 2021, Soliris secured $2.1 billion in sales while Ultomiris has already cashed in $701 million, representing a 48% increase over the same period in 2020.
Though, AstraZeneca is more focused on the long-term through exploiting synergies. The acquisition will help develop AstraZeneca’s ability to use genomics to target rare diseases, while globalising Alexion’s portfolio into emerging markets. Indeed, with Astra-Zeneca’s massive resources, Alexion may be able to do its good work faster and better. In addition, Pascal Soriot is betting on Alexion’s 11-drug pipeline while expecting Alexion’s current drugs to grow 9% per year through 2023.
There could be “room for higher revenue from Alexion’s portfolio under AstraZeneca’s wing”.
Geoffrey Porges, Senior research analyst at SVB Leerink
RISKS AND UNCERTAINTIES
The main concern concerning this deal comes from investors who fear AstraZeneca has overpayed for Alexion. Indeed, the British-Swedish giant has offered a 45% premium to Alexion’s share price, valuing the company at more than 40 times its earnings in 2020. Bearing in mind that despite hedge fund Elliott Management publicly agitating for a deal since May 2020, AstraZeneca has said that it was the only bidder in the hunt. Back in December 2020, AstraZeneca’s shares on the London Stock Exchange were down more than 7%, before rebounding slightly. However, after hitting a 52-week low of £6858 on March 5th 2021, the stock is dealing today at £8509 and is set to break the all-time high share price of £9187 confirming investors’ confidence in the company’s outlooks.