Bristol-Myers Squibb buys Celgene
The drugmaker merger is worth $74 billion.
Drugmaker Bristol-Myers has bought biotech company Celgene in a blockbuster $74 billion deal. The merger is the largest in the history of pharmaceuticals. The purchase has led to a surge in shares in both corporations.
Why Bristol- Myers bought Celgene
Bristol-Myers is the most dominant drugmaker in the US, but has faced competition from other pharmaceutical corporations like Merck in cancer fighting medication. Celgene is a biotech company that is working on gene therapy this is supposed to attack cancer cells. The merger is supposed to help the companies work together to create groundbreaking treatment for life-threatening illnesses. Bristol-Myers chief executive officer(CEO), Giovanni Cafario, noted the importance of the merger in a statement.
‘Together with Celgene, we are creating an innovative biopharma leader, with leading franchises and a deep and broad pipeline that will drive sustainable growth and deliver new options for patients across a range of serious diseases,’ noted Cafario.
‘Together with Celgene, we are creating an innovative biopharma leader, with leading franchises and a deep and broad pipeline that will drive sustainable growth and deliver new options for patients across a range of serious diseases,’ noted Cafario.
The merger will greatly benefit Celgene because its stock had been suffering in 2018. The company’s shares fell 40% even after billion-dollar purchases of other biotech corporations. Bristol-Myers stock suffered last year when the US Food and Drug Administration (FDA) delayed approval of two of its medications. Brad Loncar, chief executive officer(CEO) of Loncar Investments, noted that the joint venture was necessary for both companies to overcome poor business decisions.
‘Both of them were coming into this year kind of limping. Merging together makes the combined entity a lot stronger,’ said Loncar.
Details of the merger
Under the deal, Celgene shareholders will get $102.43 per Bristol-Myers share. They will also own 31% of the company, while Bristol-Myers stock purchasers will have control of 69% of the combined corporation. The merger is expected to be completed by the third quarter (Q3) of2019.
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