Bristol-Myers Squibb Could Finally Go on the Market; Rumored Suitors Include Gilead, Pfizer, Novartis AG and Roche

Published: Feb 16, 2017

Bristol-Myers Squibb Could Finally Go on the Market; Rumored Suitors Include Gilead, Pfizer, Novartis AG and Roche February 14, 2017
By Alex Keown, Breaking News Staff

NEW YORK – Bristol-Myers Squibb has been rumored to be a takeover target for some time and now there are at least four different companies looking at making a move, Street Insider reported this morning.

Since Jan. 10, shares of BMS have lost about 15 percent and $50 billion in market cap. Earlier this month, the company slashed its earnings projections for 2017. Now pharma giants Roche , Novartis and Pfizer are rumored to be examining the company for a possible deal. Additionally, cash-flush Gilead Sciences could also become a suitor, Street Insider said, citing unnamed sources.

As of now, there are no formal offers on the table and Street Insider noted that it’s unknown if Bristol-Myers’ board of directors is willing to entertain any offer. However, if a deal is pursued, BMS will command a high price, about $120 billion, or $72 per share, Street Insider said, citing its sources.

Each of the companies mentioned as potential suitors would find BMS’ pipeline to be highly complementary to the therapies already in play. However, each of the companies rumored to be eying BMS for a takeover, has already been chipping away at the company’s market share.

BMS has gone from the fourth most valuable pharmaceutical company in the United States to the ninth, according to a recent report by Bloomberg. Much of that has to do with a major setback the company had last year with its lead PD-1 inhibitor Opdivo. In August 2016, BMS announced Phase III data showing Opdivo failed to meet its endpoints of progression-free survival in lung cancer patients expressing PD-L1 at 5 percent. That failure allowed rival drugmaker Merck to gain market share with its PD-1 inhibitor, Keytruda. The company is concerned that Keytruda could gain approval as a first-line treatment for lung cancer.

Not only is Keytruda a threat to Opdivo market share, but Roche’s Tecentriq took 10 percent of market share away from Opdivo in the fourth quarter of 2016.

Opdivo did earn approval from the U.S. Food and Drug Administration for patients with locally advanced or metastatic urothelial carcinoma, a type of bladder cancer earlier this month.

But it wasn’t just the Opdivo setback that has hampered BMS. Last week Innate Pharma , a BMS partner, announced its experimental leukemia treatment lirilumab, which is licensed to BMS, failed a Phase II test as a single agent maintenance treatment in elderly patients with acute myeloid leukemia.

Since news of the possible acquisition broke, shares of BMS have been on the rise. As of 2 p.m., BMS shares are trading at $53.88, up about 3.5 percent from the opening price of $52.31. Share prices are still far below its yearly high of $76.77 in July 2016—which was before the failure of Opdivo.

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