On Saturday morning, AstraZeneca (NASDAQ:AZN) announced an agreement to buy Alexion Pharmaceuticals (NASDAQ:ALXN) and its line of treatments for rare diseases for $39 billion in a combination of cash and stock. Based on AstraZeneca's closing price on Friday, Alexion shareholders are in line to receive about $175 per share. 

Regulatory hurdles that come with big international mergers are expected to keep this one from completing until the third quarter of 2021. Based on yesterday's closing prices for both stocks, though, AstraZeneca's offer represents a 45% premium.

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If regulators don't try to halt the deal, Alexion shareholders will own around 15% of a much larger AstraZeneca by this time next year. Alexion shareholders are in line to receive $60 in cash plus 2.1243 of AstraZeneca's American depository shares (ADS).

This deal will give AstraZeneca Soliris and its successful follow-on treatment Ultomiris, treatments for rare diseases that involve overactive immune systems intent on bursting important blood cells for no good reason. Combined sales of the Soliris/Ultomiris franchise are expected to reach about $5 billion in 2020, which will be 17% more than in 2019.

In addition to the successful and growing Soliris/Ultomiris franchise, AstraZeneca will also gain access to treatments for a handful of rare metabolic diseases on pace to generate $840 million in revenue this year. Despite the COVID-19 pandemic, sales of Alexion's rare disease drugs didn't skip a beat in 2020. In fact, they're significantly outperforming expectations the company laid out in January.

AstraZeneca is well-equipped to fuel Alexion's growth strategy with a great deal more resources than Alexion could have mustered on its own. The big pharma's shareholders will most likely come out ahead on this deal, and Alexion shareholders would probably do well to hang on to the AstraZeneca shares they receive for the long run.

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