If AstraZeneca CEO Soriot does take Teva's helm, what comes next? Megamerger talk, maybe

The reported jump of AstraZeneca chief Pascal Soriot to Teva's top post hasn't yet been confirmed by either company—but already it's making waves in the world of Big Pharma. The news has lopped $4 billion off AZ's market cap, heightened investor fears about the company's imminent Mystic trial results, and touched off new talk of Pfizer coming back for a second megamerger attempt.

The ailing generics giant is expected to tap AstraZeneca chief Pascal Soriot as its next leader, Israeli newspaper Calcalist said Wednesday, citing unnamed sources. Other outlets have offered up new details. Soriot has reportedly met with Teva’s search committee and chairman to accept the offer, but terms aren't yet final.

Soriot won’t come cheap. AZ helmsman since 2012, he'd pocket almost double the salary of his Teva predecessor, Erez Vigodman, who in 2015 collected $5.7 million. On top of that, he’ll net a signing bonus estimated between $15 million and $20 million, according to Calcalist.

UPDATE: AstraZeneca's shares jump, Teva's sink on report that Soriot will stay put

AstraZeneca's shares took a beating on the news, which cast doubt on forthcoming results from a key immuno-oncology trial, Mystic. That lung cancer test of the company's PD-L1 drug Imfinzi (durvalumab) in combination with its CLTA4 med tremelimumab would be key for growing the fifth-to-market med's sales.

"If true, the optics around his departure would be terrible ahead of the Mystic readout," Leerink Partners analyst Seamus Fernandez wrote in a note to clients. "His exit would leave AstraZeneca rudderless in the wake of several other recent departures." Teva's stock, unsurprisingly, trended upward.

AstraZeneca said Wednesday afternoon it wouldn't comment on market rumors. Teva said the same, while reiterating Chairman Sol Barer's past statements that "his top priority is the ongoing global search to identify a world-class individual with deep and broad pharmaceutical expertise to serve as Teva's permanent CEO."

RELATED: The top 15 highest-paid biopharma executives - Pascal Soriot, AstraZeneca

Soriot's departure might just put a Pfizer-AstraZeneca pairing back on M&A matchmakers' lists, considering it was the AZ chief who led a tooth-and-nail fight against the $100 billion takeover. Pfizer dropped that bid in 2014, but talk of a new foray has resurfaced since, despite new tax inversion rules that would strip away the deal's tax benefits, at least for now; those rules, revamped by Obama Treasury Secretary Jacob Lew, could be up for review under Trump.

Pfizer has said it's open to a deal of any size, provided the matchup is worth the price, and it remains a favorite partner when Big Pharma deal rumors hit the news.

RELATED: Megamerger-happy investors bid up AZ shares on speculation that Novartis might try a takeover

Deal watchers might ship another Big Pharma pairing, too. Novartis, for instance. Though that idea's a long shot, rumors popped up last year as the Swiss drugmaker suffered some setbacks. And given the prospect of new dealmaking cash, Novartis megamerger predictions have come up since. It's also without a PD-L1 drug in its portfolio. Then again, Novartis nabbed FDA panel backing for its CAR-T therapy just Wednesday, and it has said it's not necessarily in need of a checkpoint inhibitor to grow further in oncology.

Soriot’s pay has already cued revolts at AZ, whose investors rallied against the chief executive’s £13.4 million ($17.3 million) package for 2016. Leading shareholders called on the British pharma’s board to strengthen the link between Soriot’s take-home and the lofty $45-billion-by-2023 sales goal he set to help dodge that Pfizer buyout—a mark Soriot himself now thinks the company would be “lucky” to hit.

Barer, though, has made his pledge that the companywhich has suffered a tumultuous year of M&A missteps, surprise executive exits and lower-than-expected saleswould “do what it takes” to sign on whomever the company found best suited for the job, even if it meant waiving Teva’s requirement that its head honcho live in Israel.

RELATED: Teva, ditching a penchant for Israeli execs, taps out-of-towner as lead CEO pick: report

But is Soriot “the absolute best person from anywhere,” as Barer has promised Teva’s next chief would be? The fate of AstraZeneca, still suffering hard from a series of patent-cliff falls, hinges in large part on the fate of an immuno-oncology duo that’s chasing a first-line lung cancer approval. It's that duo at the center of the Mystic trial everyone's watching. And while AZ has insisted there’s more to its portfolio, lackluster performances from its growth products over the last few quarters haven’t inspired a ton of confidence.

The way Bernstein analyst Ronny Gal sees it, Soriot would be an improvement. "It's a capable CEO with an industry track record for multiple years," he said in a Wednesday video to investors. "Maybe more controversial than some other CEOs, but in general, clearly better" than the interim situation Teva has had for the last six months. 

"Most investors of Teva, including the board, would like to simply see the stock being turned around," he added.

One thing’s for sure: Soriot knows how to cut costs, and that’s a quality Teva has said it needs. Last May, AZ set out on a $1.5 billion restructuring designed to deliver $1.1 billion in annual savings.

RELATED: Struggling Teva said to plan thousands of job cuts as it hunts for CEO

Teva has also been the subject of major restructuring rumors; back in March, Calcalist reported that the company was gearing up to lay off up to 5,000 workers, a figure Teva itself denied. While job cuts at that scale haven't happened yet, last month, interim CEO Yitzhak Peterburg told a crowd of investors at the Jefferies Global Healthcare Conference that the company’s ideal CEO candidate “will have the ability to maybe do the restructurings needed.”

Meanwhile, a transition at AstraZeneca could leave the company vulnerable to another approach from Pfizer, and industry watchers have said the New York-based drugs giant might be interested in a second run. Pfizer itself, however, has said it's committed to its current immuno-oncology strategythe Merck KGaA pact that recently produced Bavencioand at least one analyst is inclined to believe it. 

Of course, until the move is confirmed by the companies, it's only chatter. But while Credit Suisse analyst Vamil Divan wrote to clients that "a move to Teva would be surprising to us" given Soriot's background in innovative and branded pharma, he also pointed out that Calcalist correctly reported the departure of longtime Teva CFO Eyal Desheh earlier this year. "We believe there may be merit to the report," he said.

Editor's note: This story has been updated with stock movement news and analyst comments.