After several months of horses trading, hands-offs and heated debates, shareholders finally appropriated $ 74 billion to Bristol-Myers Squibb and Celgene. "We are very pleased with the new company," said Giovanni Caforio, Chairman and Chief Executive Officer of Bristol.
As Dustin Hoffman and Katherine Ross on the final scene of the "Graduate", two newlyweds from the bio-param received what they wanted, and now they will have to get used to each other. This means navigating the patent rock that deals with gross market dynamics and trying to keep key employees from updating their resume.
Here is a look at the biggest problems Bristol-Myers and Celgene face after their long-awaited alliance.
Revlimid and the patent rock from hell
Congratulations, Bristol, you now own one of the largest patent patents for drugs in the history of the pharmaceutical industry ̵
Sixty percent of this commitment goes to the treatment of several myeloma clinics Celgene. It is expected that the first general version of Revlimid will enter the market in March 2022, but only to a limited extent, as dictated by the agreement on the conclusion of contracts with the manufacturer of medicines Natco Pharma. How fast the sale of Revlimid after 2022 will slow down remains unclear, as the legal dispute between Celgene and the manufacturers of medicines continues. This fight is now in Bristol.
The Celgene pipeline should not stumble
Bristol acquired Celgene with full knowledge of the patent rock, of course. The work plan of management is to replace a good piece of lost income with new drugs from the Celgene pipeline
Three of these drugs Celgene – fedratinib, ozanimod, and luspatercept – were submitted to the Food and Drug Administration. If all goes well, fedratinib will be approved for the treatment of myelofibrosis in September, with ozanimod (for multiple sclerosis) and luspatercept (for myelodysplastic syndrome and beta-thalassemia) after the start of 2020. Two CAR-T cancer therapy is called bb2121 and liso-cel in the late stages of clinical trials, but they are also critical to the success of the Bristol-Chelsea marriage. Failure for failures or delays is infinitely small.
Bristol cows lose their positions
Once Bristol was at the forefront of immune cancer. In 2016, Opdivo headed the multibillion market and looked ready to maintain leadership. Then came a series of clinical trials that made the Keytruda Merck similar to the best product in the class, stealing Opdivo's market share and moving Bristol's therapy to second place.
This puts Bristol, which received about 30% of its revenue from Opdivo last year, in a harsh place. Opdivo is likely to be exposed to bio-like competition over the next seven to nine years, and its reduction in immune-oncology emphasizes how much Bristol, like Celgene, needs cancer therapy for the next generation
19659008] Mergers are not just about products and profits. People are also important. It's never easy to connect two big companies, but Bristol should be especially careful not to allow talented scientists and businessmen to go through the door through the firm's rivalry or battle on the lawns. Medicines that save lives do not develop independently. Want to read early about the success (or failure) of Bristol-Cheleng's marriage? Check LinkedIn before the earnings report.
Many Celgene friends may have questions
Celgene has long been known as a ready partner in the field of biotechnology, and the company has spent many years knowing the tapestry of transactions that, in essence, called for its option for every new idea. cancer treatment. Now, however, dozens of Celgene partners may be surprised if a company still values their relationship.
Some, such as Bluebird Bio and Acceleron, have nothing to worry about, as their collaboration has been verified by Bristol as the key to Celgene's value. But others may have been less fortunate, including BeiGene, a company whose licensed Celgene project is a competitor to Bridolot Opdivo.
Biotech as a whole loses its most fruitful player in business development
Biotechnologists sent dollar deals altogether like Celgene. Since 2008, Celgene spent $ 131 billion on the acquisition, partnership and licensing of small biotechnologies, according to DealForma. It's more than all the money, like invested by big-tech biotech brothers, together.
From Celgene, will Bristol's pockets be deep? If not, the development of the biotech business will suffer?
The journey is not over for the shareholders of Celgene
Among the less discussed aspects of the merger is: according to the agreement, each share of Celgene costs one share of Bristol, $ 50 in cash, and one lottery ticket called CVR. Short of the right to value, CVR is a trade note that gives its holder the right to pay cash if certain futures are made. In the case of Celgene, cash is $ 9, and the following are the following: Ozanimod and liso-cel must win the approval of the FDA by the end of 2020, and bb2121 must do so by the end of 2021.
this means that any of these treatment methods is rejected – or even approved one day after the expiry date – CVR is worthless. This makes it a fairly high offer rate for the shareholders of Celgene. And, in particular, the two sides in the deal have different expectations. As Mizuho analysts said earlier this week, Celgene assigns approximately 69% of the probability of success, giving CVR costs around $ 6, while Bristol believes that the odds of paying 45% are 45%.
CVR will be traded on the open market, so we will soon find out that the wisdom of the crowd has to say about the Celgene pipeline.
What's in the title?
Bristol-Myers Corporation and Squibb Corp. joined in 1989 to form Bristol-Myers Squibb. From the management of Bristol, there was no suggestion that another corporate rebranding is being considered. It's a shame because seeing Zelgen, an ancient biotech leader, will disappear, it will be strange.
Not that someone asks for our advice, but Bristol Selgin Squibb has a nice ring. Or, what about Bristol-Myers Celgene? Not bad. Bristol-Myers Celgene Squibb starts to sound too much like a law firm. Bristolgene-Myers Squibb-Cel? Please no.