Bristol Myers Acquires RayzeBio for $4.1 Billion to Enhance Cancer Drug Business

         

Bristol Myers Squibb announces the acquisition of RayzeBio for $4.1 billion, aiming to strengthen its cancer drug portfolio by gaining access to late-stage targeted cancer therapy.

Bristol Myers Squibb’s Strategic Acquisition

Bristol Myers Squibb has revealed its plan to acquire RayzeBio for approximately $4.1 billion, in a move to bolster its cancer drug business. This acquisition marks the second significant deal made by the pharmaceutical company within a week.

Access to Late-Stage Targeted Cancer Therapy

Through this acquisition, Bristol Myers Squibb is set to gain access to RayzeBio’s late-stage targeted cancer therapy, RYZ101. This therapy involves a combination of radioactive particles that target and kill cancer cells, along with molecules that attach to tumors.

Motivation behind the Acquisition

Bristol Myers Squibb’s decision to pursue acquisitions is driven by the looming generic competition for its top drugs, including Revlimid and Eliquis, as well as the expected patent loss for its cancer immunotherapy drug Opdivo later in the decade. By acquiring RayzeBio and Karuna Therapeutics, the company aims to diversify its drug portfolio and mitigate the impact of potential revenue losses.

Financial Details

The acquisition of RayzeBio will be executed at a price of $62.50 per share in cash, entailing a 104% premium to the stock’s last closing price. Bristol Myers Squibb anticipates funding the transaction mainly through new debt. It has projected a reduction of around 13 cents in its adjusted profit per share for 2024 as a result of the deal.

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