BMS Closes the Year with $14B Karuna Buy to Bolster Neuro Portfolio

Bristol Myers Squibb/iStock, JHVEPhoto

Pictured: A BMS building in California/iStock, JHVEPhoto

Bristol Myers Squibb and neuroscience-focused Karuna Therapeutics announced on Friday that they have entered into a definitive merger agreement with a total equity value of $14 billion.

Under the terms of the deal, BMS will buy all outstanding shares of Karuna’s common stock for $330 a pop in cash, a roughly 53.4% premium to the stock’s closing price on Thursday. The transaction, which the companies expect to close in the first half of 2024, will be worth a net of $12.7 billion in estimated cash acquired.

The boards of directors of both BMS and Karuna have unanimously signed off on the deal. However, its closing will still be subject to regulatory and antitrust clearance, among other customary conditions, as well as the approval of Karuna’s stockholders.

BMS CEO Christopher Boerner said in a statement that the acquisition of Karuna positions BMS to take advantage of the “tremendous opportunities in neuroscience” and “accelerates the expansion and diversification of our portfolio in the space.”

At the center of the merger is Karuna’s investigational muscarinic antipsychotic KarXT (xanomeline-trospium), which is being developed for schizophrenia and psychosis in Alzheimer’s disease. Late last month, the FDA accepted the New Drug Application for Karuna in schizophrenia and is set to release its verdict in September 2024.

According to Friday’s announcement, KarXT is expected to launch in the U.S. in late 2024. The therapy will enter a market of approximately 1.6 million patients undergoing treatment for schizophrenia, many of whom do not respond to currently available medications or suffer from harsh side effects.

Unlike existing schizophrenia therapies, KarXT does not block dopamine receptors but instead activates both the M1 and M4 muscarinic acetylcholine receptors in the central nervous system. This mechanism of action helps improve the positive and negative symptoms of schizophrenia, as well as improve patients’ cognition.

If approved, KarXT would be the first new class of schizophrenia treatment in over five decades, Karuna founder and COO Andrew Miller told BioSpace in an April 2023 interview.

Beyond schizophrenia, Karuna is also developing KarXT for Alzheimer’s disease psychosis, for which it is currently running registrational clinical trials with readouts expected in 2026.

For BMS, Karuna is the latest development in its dealmaking spree in recent months. Last week, the pharma signed a potential $8.4 billion contract with SystImmune, giving it the right to co-develop and co-commercialize the investigational bispecific antibody-drug conjugate BL-B01D1, which is being tested for solid tumors, outside Mainland China.

A few weeks earlier, BMS expanded an existing collaboration with Avidity Biosciences, adding up to five more cardiovascular disease targets for $100 million upfront and potential cumulative payments of $2.3 billion.

Tristan Manalac is an independent science writer based in Metro Manila, Philippines. He can be reached at or

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