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Lawsuit alleges Novo's 30-month closing period would stall

Metsera's ( MTSR ) obesity drug

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Metsera ( MTSR ) says Pfizer ( PFE ) using litigation to lower its takeover

price

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Novo insists its offer complies with merger terms

(Adds comments from Metsera ( MTSR ), Novo in paragraphs 3-5)

By Sabrina Valle, Mrinalika Roy and Tom Hals

Nov 3 (Reuters) - Pfizer ( PFE ) filed an antitrust

lawsuit on Monday accusing Danish drugmaker Novo Nordisk

of structuring its $9 billion bid for biotech Metsera ( MTSR )

to stall, not close, the deal, a tactic it said is

designed to suppress competition in obesity drugs.

Pfizer ( PFE ) agreed to pay up to $7.3 billion for Metsera ( MTSR ) in

September. Last week, after Novo's top investor seized control

of its board, the company launched a rival bid that Metsera ( MTSR ) -

its seventh since January - said was superior to Pfizer's ( PFE ). It

gave Pfizer ( PFE ) until Tuesday to submit a higher offer.

Metsera's ( MTSR ) board filed a letter with the Delaware court on Monday

urging the judge to deny Pfizer's ( PFE ) request for a hearing on a

temporary restraining order to block Novo's bid. Metsera ( MTSR ) accused

Pfizer ( PFE ) of gaming the schedule by not suing sooner, when it knew

of Novo's bid on October 25.

Metsera ( MTSR ) said the latest lawsuit was an attempt by Pfizer ( PFE ) to

drive down its takeover price. The company in a statement said

its board remains committed to protecting shareholder and

patient interests and described Pfizer's ( PFE ) allegations as

"nonsense," adding that it will respond to the claims in court.

Novo on Monday said its proposal was compelling and exceeds

Pfizer's ( PFE ). "We closely adhered to all of the restrictions under

the Pfizer ( PFE ) merger agreement and are confident that the facts and

the law are on our side," Novo said in a statement.

Metsera ( MTSR ) is developing a new obesity drug that would have the

benefit of monthly injections versus weekly injections required

for wildly popular Wegovy from Novo and Eli Lilly's ( LLY )

Zepbound and Mounjaro.

Pfizer ( PFE ), which does not currently sell a weight-loss drug, is

betting on Metsera ( MTSR ) to help it enter an obesity market some

analysts forecast could soon reach $150 billion annually and

offset falling COVID-related revenue and looming patent

expirations.

Metsera ( MTSR ) is working on experimental therapies analysts say

could generate $5 billion in sales.

PFIZER SAYS NOVO AIMS TO DELAY COMPETITION

Pfizer's ( PFE ) second complaint, filed in U.S. District Court in

Delaware on Monday, alleges Novo Nordisk is using a 30-month

"outside date" - the period before either party can terminate

the merger - to delay Metsera's ( MTSR ) entry into the market for

obesity drugs that target the GLP-1 protein, currently dominated

by Novo and Lilly.

Pfizer ( PFE ) said its own deal with Metsera ( MTSR ) had a nine-month

timeline and received early termination of antitrust review on

October 31.

The Delaware court is expected to assign a judge to Pfizer's ( PFE )

case later on Monday, with a hearing on the company's request

for a temporary restraining order likely to be set for Tuesday,

a person familiar with the matter told Reuters, adding that the

court typically rules at or shortly after such hearings.

Pfizer ( PFE ) claims Novo Nordisk's bid is not a genuine acquisition

attempt but a strategic maneuver to block Metsera ( MTSR ) from advancing

its drugs in development and preserve Wegovy and Ozempic's

market share.

In the suit, Novo is accused of offering Metsera ( MTSR ) shareholders

$6.5 billion upfront - before regulatory review - and tying the

company to restrictive covenants that delay or prevent clinical

progress.

While investors could see immediate returns from a deal, Pfizer ( PFE )

warns that Novo could use the interim period to choke off

funding, restrict hiring, and stall clinical trials for

Metsera's ( MTSR ) obesity drug candidates.

"Something is clearly rotten in the state of Denmark," Pfizer ( PFE )

wrote in its complaint - a pointed reference to Shakespeare's

Hamlet that underscores the company's view of Novo's motives

following a recent board purge by its controlling shareholder.

On Friday, Pfizer ( PFE ) asked the Delaware court to issue a temporary

restraining order to block Metsera ( MTSR ) from terminating the

agreement between the companies.

Metsera ( MTSR ) in its Monday letter, urged the court to deny

Pfizer's ( PFE ) request to hold a hearing on Tuesday, arguing that

Pfizer ( PFE ) could increase its bid and then pursue litigation, or

raise its bid after the Tuesday deadline.