Bigger fish: ResApp to be acquired by pharma giant Pfizer

It’s not a question of AstraZeneca or Pfizer for digital health company ResApp Health (ASX: RAP) who have today entered into a binding scheme implementation deed to be acquired by pharmaceutical giant, Pfizer. Yes, one of the world’s biggest pharma companies has been perusing the ASX for a small homegrown biotech to snap up, we’re that good. 

The acquisition price put forward by Pfizer is set at $0.115 per share, with a total value of $100 million. This is a 27.8% premium to the Company’s closing price on April 8, which came in at $0.09 per share. 

Unsurprisingly, the ResApp board has welcomed the offer, with unanimous approval in favour of the deal. 

On top of their offer to acquire ResApp, Pfizer is also offering support for ResApp’s R&D by way of a Research and Development License Agreement. Each entity will maintain their respective intellectual property for the duration of the licence (6 months initially). Pfizer has put forward a total of $4 million, $3 million for an up-front licence fee and $1 million to be paid as clinical trial milestones are met. The agreement ultimately gives Pfizer the Right of First negotiation for commercial transactions. 

ResApp CEO and Managing Director, Tony Keating commented: “We are excited by the prospect of this acquisition by Pfizer, a leading biopharmaceutical company that shares our vision and belief that technology can help transform healthcare and improve patients’ lives. The proposed acquisition recognises the years of dedicated work by the ResApp team to build ResApp into a leader in audio-based analysis of respiratory health. We believe that the material premium and certainty of an all cash consideration is an attractive outcome for our shareholders.”

ResApp have been hard at work over the past few years developing their smartphone based platform for the diagnosis and management of respiratory conditions. The World Health Organisation estimates that a total of 65 million people suffer from moderate to severe chronic obstructive pulmonary disease (COPD) worldwide. 334 million suffer from asthma of some form. The incidence of respiratory ailments is climbing with increased environmental pollution and the effects of long COVID. 

ResApp’s platform uses a smartphone microphone to analyse a patient’s breathing. They boast two products- ResAppDx, a diagnostic test for respiratory disease, and SleepCheck, a smartphone app for self risk assessment of sleep apnoea. Both products hold full regulatory approval being CE Marked in Europe and TGA approved in Australia. 

The Company is focussed on getting their tech into the hands of doctors in outpatient services and primary care to facilitate commercial agreements. The latest clinical pilot has been signed with a major hospital network in the UK which services over 500,000 people in the region.