Bristol-Myers Squibb to Acquire Celgene Corporation

In a merger agreement announced today, Bristol-Myers Squibb will be acquiring Celgene Corporation in a $74 billion deal to be paid with a combination of cash and stocks.

Giovanni Caforio, MD

In a merger agreement announced today, Bristol-Myers Squibb (BMS) will be acquiring Celgene Corporation in a $74 billion deal to be paid with a combination of cash and stocks.1

Under the agreement, which has been agreed upon by the Board of Directors at both companies, Celgene shareholders will obtain 1.0 Bristol-Myers Squibb share as well as $50 in cash for each share of Celgene. Additionally, for every share of Celgene, Celgene shareholders will receive 1 tradeable Contingent Value Right, which will enable the holder to obtain a payment for the achievement of any future regulatory milestones.

“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,” said Giovanni Caforio, MD, the chairman and chief executive officer of BMS, in a press release.

Of the 6 expected product launches, 2 are in hematology — luspatercept, lisocabtagene maraleucel (liso-cel; JCAR017), bb2121, and fedratinib – and 2 are in immunology and inflammation – TYK2 and ozanimod.

Luspatercept is a first-in-class erythroid maturation agent, which has been found to significantly reduce the need for frequent red blood cell (RBC) transfusions in nearly 53% of patients with anemia associated with low- to intermediate-risk myelodysplastic syndrome, according to results from the phase III MEDALIST trial.2The agent has also demonstrated tolerability in patients who required regular RBC transfusions and demonstrated abnormal iron overload in RBC precursors before participating in the trial.

The CD19-directed 4-1BB chimeric antigen receptor (CAR) T-cell therapy liso-cel has shown tolerability and was shown to induce an 81.3% best overall response rate (ORR) and 43.8% complete response (CR) rate in heavily pretreated, high-risk patients with chronic lymphocytic leukemia who previously received ibrutinib (Imbruvica), according to dose-finding results from a small phase I/II trial.3The therapy also demonstrated low rates of grade 3 cytokine release syndrome and neurotoxicity.

bb2121, an anti-BCMA CAR T-cell therapy, demonstrated a median progression-free survival of 11.8 months and a median duration of response of 10.8 months in patients with relapsed/refractory heavily pretreated multiple myeloma in the phase I CRB-401 trial.4

Fedratinib, a highly selective JAK2 kinase inhibitor in development for myelofibrosis and polycythemia vera, is under renewed investigation following a previous clinical hold by the FDA. The hold was issued in 2013 due to concerns for thiamine-related Wernicke’s encephalopathy.

The near-term launch opportunities equate to more than $15 billion in revenue potential.

This acquisition adds to the existing BMS portfolio, which includes nivolumab (Opdivo), a PD-1 inhibitor with indications in non—small cell lung cancer, small cell lung cancer, classical Hodgkin lymphoma, melanoma, renal cell carcinoma (RCC), squamous cell carcinoma of the head and neck, urothelial carcinoma, hepatocellular carcinoma, and microsatellite instability-high or mismatch repair deficient colorectal cancer, which is in combination with ipilimumab (Yervoy).

Additionally, ipilimumab (Yervoy) has indications in melanoma and renal cell carcinoma, and also in combination with nivolumab.

Other BMS products include dasatinib (Sprycel), which was recently granted FDA approval in January 2019, to be used in combination with chemotherapy for the treatment of pediatric patients ≥1 year of age with newly diagnosed Philadelphia chromosome-positive (Ph+) acute lymphoblastic leukemia. The agent is already approved in pediatric patients with Ph+ chronic myeloid leukemia in chronic phase.

Another BMS product, elotuzumab (Empliciti), received FDA approval in November 2018 for use in combination with pomalidomide (Pomalyst) and low-dose dexamethasone for the treatment of patients with relapsed/refractory multiple myeloma following 2 or more prior therapies, including lenalidomide (Revlimid) and a proteasome inhibitor.

Through the merger, BMS will be well positioned to address the needs of patients with cancer, inflammatory, and immunologic disease as well as cardiovascular disease, according to the announcement.

The cash and stock consideration to be received by Celgene shareholders at closing is valued at $102.43 per each Celgene share and 1 CVR, based on the closing price of BMS stock of $52.43 on January 2, 2019. When the transaction is completed, BMS shareholders are projected to own about 69% of the company, while Celgene shareholders are expected to own approximately 31%.

“We are impressed by what Celgene has accomplished for patients, and we look forward to welcoming Celgene employees to Bristol-Myers Squibb,” said Caforio in a press release. “Our new company will continue the strong patient focus that is core to both companies’ missions, creating a shared organization with a goal of discovering, developing, and delivering innovative medicines for patients with serious diseases.”

References:

  1. Bristol-Meyers Squibb to acquire Celgene to create a premier innovative biopharma company [news release]. New York & Summit, NJ: Business Wire; January 3, 2018. news.bms.com/press-release/corporatefinancial-news/bristol-myers-squibb-acquire-celgene-create-premier-innovative. Accessed January 3, 2018.
  2. Fenaux P, Platzbecker U, Mufti GJ, et al. The MEDALIST trial: results of a phase 3, randomized, double-blind, placebo-controlled study of luspatercept to treat anemia in patients with very low-, low-, or intermediate-risk myelodysplastic syndromes (MDS) with ring sideroblasts (RS) who require red blood cell (RBC) transfusion. In: Proceedings from the 2018 ASH Annual Meeting; Dec. 1-4, 2018; San Diego, California. Abstract 1. ash.confex.com/ash/2018/webprogram/Paper110805.html.
  3. Siddiqi T, Soumerai JD, Wierda WG, et al. Rapid MRD-negative responses in patients with relapsed/refractory CLL treated with liso-cel, a CD19-directed CAR T-cell product: preliminary results from TRANSCEND CLL 004, a phase 1/2 study including patients with high-risk disease previously treated with ibrutinib. In: Proceedings from the 2018 ASH Annual Meeting and Exposition; December 1-4, 2018; San Diego, California. Abstract 300. ash.confex.com/ash/2018/webprogram/Paper110462.html.
  4. Raje NS, Berdeja JG, Lin Y, et al. bb2121 anti-BCMA CAR T-cell therapy in patients with relapsed/refractory multiple myeloma: Updated results from a multicenter phase I study [ASCO abstract 8007].J Clin Oncol. 2018;36(suppl):8007. doi: 10.1200/JCO.2018.36.15_suppl.8007.

“As a combined entity, we will enhance our leadership positions across our portfolio, including in cancer and immunology and inflammation. We will also benefit from an expanded early- and late-stage pipeline that includes six expected near-term product launches. Together, our pipeline holds significant promise for patients, allowing us to accelerate new options through a broader range of cutting-edge technologies and discovery platforms.”