Arthur J. Villasanta – Fourth Estate Contributor
Purchase, NJ, United States (4E) – U.S. pharmaceutical giant Bristol-Myers Squibb Company (BMS) has announced a $74 billion deal to buy Celgene Corporation in one of the biggest mergers in pharmaceutical industry history.
The deal still needs the approval of shareholders and federal regulators. It will be paid with a combination of stock and cash.
Celgene, the ninth largest U.S. pharmaceutical firm, posted revenues of $13.5 billion in 2017. Based in Summit, New Jersey, Celgene discovers, develops and commercializes medicines for cancer and inflammatory disorders.
Its top product is Revlimid (lenalidomide), which in combination with dexamethasone, is used for the treatment of multiple myeloma, a cancer that affects bone marrow and white blood cells. Revlimid contributed $8.2 billion in sales to Celgene.
BMC is the eighth largest American drugmaker and had annual revenues of $20.8 billion in 2017. The merged company will become the fourth largest pharmaceutical firm in the U.S. Together they have nine different drugs: six from Bristol-Myers and three from Celgene.
Both firms also have six other drugs under development that might hit the marker over the next 12 to 24 months. These drugs represent more than $15 billion in potential annual revenue. The merged firm, however, faces the looming patent expirations for Revlimid in the next four years.
If three of its new drugs receive FDA approval, Celgene shareholders will get an additional $9 for every current share of Celgene stock they held at the time of the merger.
Shares of Bristol-Myers fell more than 13% in Thursday’s trading session on news of the deal, while shares of Celgene jumped 20%.
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