Bristol-Myers Squibb will acquire Celgene in a deal worth about $74 billion. It is ine of the largest acquisition / deal in pharmaceutical and biopharmaceutical industry.
Objective of the maga deal:
“Establishing largest Oncology Company”.
The companies have similar yet complementary portfolios in oncology, inflammatory and immunologic disease and cardiovascular disease through high-value innovative medicines and leading scientific capabilities.
In oncology, for example, BMS is a leader in solid tumors, whereas Celgene’s expertise is in blood cancers.
Fact based outcome of the mega deal:
This deal will ensures nine drugs with over $1 billion in annual sales six drug candidates expected to launch in the next two years; the potential to extract $2.5 billion in cost savings from the combination; and a broad early- to mid-stage drug pipeline.
Compelling Strategic Benefits
- Leading franchises with complementary product portfolios provide enhanced scale and balance. The combination creates:
- Leading oncology franchises in both solid tumors and hematologic malignancies led by Opdivo and Yervoy as well as Revlimid and Pomalyst;
- A top five immunology and inflammation franchise led by Orencia and Otezla; and
- The #1 cardiovascular franchise led by Eliquis.
The combined company will have nine products with more than $1 billion in annual sales and significant potential for growth in the core disease areas of oncology, immunology and inflammation and cardiovascular disease.
- Near-term launch opportunities representing greater than $15 billion in revenue potential. The combined company will have six expected near-term product launches:
- Two in immunology and inflammation, TYK2 and ozanimod; and
- Four in hematology, luspatercept, liso-cel (JCAR017), bb2121 and fedratinib.
These launches leverage the combined commercial capabilities of the two companies and will broaden and enhance Bristol-Myers Squibb’s market position with innovative and differentiated products. This is in addition to a significant number of lifecycle management registrational readouts expected in Immuno-Oncology (IO).
- Early-stage pipeline builds sustainable platform for growth. The combined company will have a deep and diverse early-stage pipeline across solid tumors and hematologic malignancies, immunology and inflammation, cardiovascular disease and fibrotic disease leveraging combined strengths in innovation. The early-stage pipeline includes 50 high potential assets, many with important data readouts in the near-term. With a significantly enhanced early-stage pipeline, Bristol-Myers Squibb will be well positioned for long-term growth and significant value creation.
- Powerful combined discovery capabilities with world-class expertise in a broad range of modalities. Together, the Company will have expanded innovation capabilities in small molecule design, biologics/synthetic biologics, protein homeostasis, antibody engineering and cell therapy. Furthermore, strong external partnerships provide access to additional modalities.
Compelling Financial Benefits
- Strong returns and significant immediate EPS accretion. The transaction’s internal rate of return is expected to be well in excess of Celgene’s and Bristol-Myers Squibb’s cost of capital. The combination is expected to be more than 40 percent accretive to Bristol-Myers Squibb’s EPS on a standalone basis in the first full year following close of the transaction.
- Strong balance sheet and cash flow generation to enable significant investment in innovation. With more than $45 billion of expected free cash flow generation over the first three full years post-closing, the Company is committed to maintaining strong investment grade credit ratings while continuing its dividend policy for the benefit of Bristol-Myers Squibb and Celgene shareholders. Bristol-Myers Squibb will also have significant financial flexibility to realize the full potential of the enhanced late- and early-stage pipeline.
- Meaningful cost synergies. Bristol-Myers Squibb expects to realize run-rate cost synergies of approximately $2.5 billion by 2022. Bristol-Myers Squibb is confident it will achieve efficiencies across the organization while maintaining a strong, core commitment to innovation and delivering the value of the portfolio.