US pharmaceuticals group Pfizer has agreed to buy biotechnology group BioHaven for more than $11.8 billion (€11.1 billion) in cash, in what will be its biggest deal in more than five years, according to people with direct knowledge of the matter.

Pfizer will pay $152 per share to purchase the Connecticut-based company. That amounts to an 83 per cent premium to its closing price of $83 per share on Monday. A deal is expected to be announced within hours, the people said.

BioHaven specialises in developing drugs that target neurological diseases and rare disorders. Pfizer has previously invested in the company and the deal would be the largest for the US drugmaker since its 2016 purchase of Medivation.

The purchase “appears to be an auspicious financial move – investing more of its Covid-19-driven windfall to forge future growth,” Bloomberg Intelligence pharma analyst John Murphy said in a note. In light of the companies’ existing agreement on migraine drugs “this looks like a commercial decision based on a more detailed assessment of available data.” – Copyright The Financial Times Limited 2022/Bloomberg