Bristol-Myers Squibb Co is all set to buy Celgene Corp for about $74 billion. The deal shook the entire pharmaceutical industry as it is going to be the biggest pharmaceutical deal, including the valuation of net debt. The transaction values Celgene to nearly $88.8 billion, more than Pfizer – Warner-Lambert deal in the year 2000, according to Refinitiv. Both the company strongly believes that the acquisition will unite their efforts to find innovative and advanced technique for cancer treatments. The companies will collaborate to launch six products in next 12 to 24 month.
Bristol-Myers cracked this giant deal under its Chief Executive Officer Giovanni Caforio. It came after the company has been recovering from the major hit in immuno-oncology, one it’s most lucrative segments. In his recent earning call, the CEO stated that the company is looking for more such deals to diversify its pipeline.
Shareholders skeptical about Acquisition Deal
The initial reaction of the shareholders of both companies is not good. Owing to the major dilemma regarding future prospect of business, both the companies faced major setback from their shareholders. Celgene shares soared by 24 percent whereas Bristol shares fell 14 percent to $45.08. Bristol-Myers will get the control of top-selling blood cancer therapy Revimid of Celgene whose net worth is more than $100,000 a year. In addition to Revimid, it will also gain the authority of experimental CAR-T therapy developed by Juno Therapeutics which Celgene acquired last year in a $9 billion deal.