- Highly Complementary Portfolios with
Leading Franchises in Oncology, Immunology and Inflammation and
Cardiovascular Disease
- Significantly Expands Phase III Assets
with Six Expected Near-Term Product Launches, Representing Greater
Than $15 Billion in Revenue Potential
- Registrational Trial Opportunities and
Early-Stage Pipeline Position Combined Company for Sustained
Leadership Underpinned by Cutting-Edge Technologies and Discovery
Platforms
- Strong Combined Cash Flows, Enhanced
Margins and EPS Accretion of Greater Than 40% in First Full
Year
- Approximately $2.5 Billion of Expected
Run-Rate Cost Synergies to Be Achieved by 2022
Bristol-Myers Squibb Company (NYSE:BMY) and Celgene Corporation
(NASDAQ:CELG) today announced that they have entered into a
definitive merger agreement under which Bristol-Myers Squibb will
acquire Celgene in a cash and stock transaction with an equity
value of approximately $74 billion. Under the terms of the
agreement, Celgene shareholders will receive 1.0 Bristol-Myers
Squibb share and $50.00 in cash for each share of Celgene. Celgene
shareholders will also receive one tradeable Contingent Value Right
(CVR) for each share of Celgene, which will entitle the holder to
receive a payment for the achievement of future regulatory
milestones. The Boards of Directors of both companies have approved
the combination.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20190103005311/en/
The transaction will create a leading focused specialty
biopharma company well positioned to address the needs of patients
with cancer, inflammatory and immunologic disease and
cardiovascular disease through high-value innovative medicines and
leading scientific capabilities. With complementary areas of focus,
the combined company will operate with global reach and scale,
maintaining the speed and agility that is core to each company’s
strategic approach.
Based on the closing price of Bristol-Myers Squibb stock of
$52.43 on January 2, 2019, the cash and stock consideration to be
received by Celgene shareholders at closing is valued at $102.43
per Celgene share and one CVR (as described below). When completed,
Bristol-Myers Squibb shareholders are expected to own approximately
69 percent of the company, and Celgene shareholders are expected to
own approximately 31 percent.
“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, M.D.,
Chairman and Chief Executive Officer of Bristol-Myers Squibb. “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.”
Dr. Caforio continued, “We are impressed by what Celgene has
accomplished for patients, and we look forward to welcoming Celgene
employees to Bristol-Myers Squibb. 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. We are confident we will drive value for
shareholders and create opportunities for employees.”
“For more than 30 years, Celgene’s commitment to leading
innovation has allowed us to deliver life-changing treatments to
patients in areas of high unmet need. Combining with Bristol-Myers
Squibb, we are delivering immediate and substantial value to
Celgene shareholders and providing them meaningful participation in
the long-term growth opportunities created by the combined
company,” said Mark Alles, Chairman and Chief Executive Officer of
Celgene. “Our employees should be incredibly proud of what we have
accomplished together and excited for the opportunities ahead of us
as we join with Bristol-Myers Squibb, where we can further advance
our mission for patients. We look forward to working with the
Bristol-Myers Squibb team as we bring our two companies
together.”
Compelling Strategic Benefits
- Leading franchises with
complementary product portfolios provide enhanced scale and
balance. The combination creates:
- Leading oncology franchises in both
solid tumors and hematologic malignancies led by Opdivo and Yervoy
as well as Revlimid and Pomalyst;
- A top five immunology and inflammation
franchise led by Orencia and Otezla; and
- The #1 cardiovascular franchise led by
Eliquis.
The combined company will have nine products with more than $1
billion in annual sales and significant potential for growth in the
core disease areas of oncology, immunology and inflammation and
cardiovascular disease.
- Near-term launch opportunities
representing greater than $15 billion in revenue potential. The
combined company will have six expected near-term product
launches:
- Two in immunology and inflammation,
TYK2 and ozanimod; and
- Four in hematology, luspatercept,
liso-cel (JCAR017), bb2121 and fedratinib.
These launches leverage the combined commercial capabilities of
the two companies and will broaden and enhance Bristol-Myers
Squibb’s market position with innovative and differentiated
products. This is in addition to a significant number of lifecycle
management registrational readouts expected in Immuno-Oncology
(IO).
- Early-stage pipeline builds
sustainable platform for growth. The combined company will have
a deep and diverse early-stage pipeline across solid tumors and
hematologic malignancies, immunology and inflammation,
cardiovascular disease and fibrotic disease leveraging combined
strengths in innovation. The early-stage pipeline includes 50 high
potential assets, many with important data readouts in the
near-term. With a significantly enhanced early-stage pipeline,
Bristol-Myers Squibb will be well positioned for long-term growth
and significant value creation.
- Powerful combined discovery
capabilities with world-class expertise in a broad range of
modalities. Together, the Company will have expanded innovation
capabilities in small molecule design, biologics/synthetic
biologics, protein homeostasis, antibody engineering and cell
therapy. Furthermore, strong external partnerships provide access
to additional modalities.
Compelling Financial Benefits
- Strong returns and significant
immediate EPS accretion. The transaction’s internal rate of
return is expected to be well in excess of Celgene’s and
Bristol-Myers Squibb’s cost of capital. The combination is expected
to be more than 40 percent accretive to Bristol-Myers Squibb’s EPS
on a standalone basis in the first full year following close of the
transaction.
- Strong balance sheet and cash flow
generation to enable significant investment in innovation. With
more than $45 billion of expected free cash flow generation over
the first three full years post-closing, the Company is committed
to maintaining strong investment grade credit ratings while
continuing its dividend policy for the benefit of Bristol-Myers
Squibb and Celgene shareholders. Bristol-Myers Squibb will also
have significant financial flexibility to realize the full
potential of the enhanced late- and early-stage pipeline.
- Meaningful cost synergies.
Bristol-Myers Squibb expects to realize run-rate cost synergies of
approximately $2.5 billion by 2022. Bristol-Myers Squibb is
confident it will achieve efficiencies across the organization
while maintaining a strong, core commitment to innovation and
delivering the value of the portfolio.
Terms and Financing
Based on the closing price of Bristol-Myers Squibb stock on
January 2, 2019, the cash and stock consideration to be received by
Celgene shareholders is valued at $102.43 per share. The cash and
stock consideration represents an approximately 51 percent premium
to Celgene shareholders based on the 30-day volume weighted average
closing stock price of Celgene prior to signing and an
approximately 54 percent premium to Celgene shareholders based on
the closing stock price of Celgene on January 2, 2019. Each share
also will receive one tradeable CVR, which will entitle its holder
to receive a one-time potential payment of $9.00 in cash upon FDA
approval of all three of ozanimod (by December 31, 2020), liso-cel
(JCAR017) (by December 31, 2020) and bb2121 (by March 31, 2021), in
each case for a specified indication.
The transaction is not subject to a financing condition. The
cash portion will be funded through a combination of cash on hand
and debt financing. Bristol-Myers Squibb has obtained fully
committed debt financing from Morgan Stanley Senior Funding, Inc.
and MUFG Bank, Ltd. Following the close of the transaction,
Bristol-Myers Squibb expects that substantially all of the debt of
the combined company will be pari passu.
Accelerated Share Repurchase Program
Bristol-Myers Squibb expects to execute an accelerated share
repurchase program of up to approximately $5 billion, subject to
the closing of the transaction, market conditions and Board
approval.
Corporate Governance
Following the close of the transaction, Dr. Caforio will
continue to serve as Chairman of the Board and Chief Executive
Officer of the company. Two members from Celgene’s Board will be
added to the Board of Directors of Bristol-Myers Squibb. The
combined company will continue to have a strong presence throughout
New Jersey.
Approvals and Timing to Close
The transaction is subject to approval by Bristol-Myers Squibb
and Celgene shareholders and the satisfaction of customary closing
conditions and regulatory approvals. Bristol-Myers Squibb and
Celgene expect to complete the transaction in the third quarter of
2019.
Advisors
Morgan Stanley & Co. LLC is serving as lead financial
advisor to Bristol-Myers Squibb, and Evercore and Dyal Co. LLC are
serving as financial advisors to Bristol-Myers Squibb. Kirkland
& Ellis LLP is serving as Bristol-Myers Squibb’s legal counsel.
J.P. Morgan Securities LLC is serving as lead financial advisor and
Citi is acting as financial advisor to Celgene. Wachtell, Lipton,
Rosen & Katz is serving as legal counsel to Celgene.
Bristol-Myers Squibb 2019 EPS Guidance
In a separate press release issued today, Bristol-Myers Squibb
announced its 2019 EPS guidance for full-year 2019, which is
available on the “Investor Relations” section of the Bristol-Myers
Squibb website at https://www.bms.com/investors.html.
Conference Call
Bristol-Myers Squibb and Celgene will host a conference call
today, at 8:00 a.m. ET to discuss the transaction. The conference
call can be accessed by dialing (800) 347-6311 (U.S. / Canada) or
(786) 460-7199 (International) and giving the passcode 4935567. A
replay of the call will be available from January 3, 2019 until
January 17, 2019 by dialing (888) 203-1112 (U.S. / Canada) or (719)
457-0820 (International) and giving the passcode 4935567.
A live webcast of the conference call will be available on the
investor relations section of each company’s website at
Bristol-Myers Squibb https://www.bms.com/investors.html and Celgene
https://ir.celgene.com/investors/default.aspx.
Presentation and Infographic
Associated presentation materials and an infographic regarding
the transaction will be available on the investor relations section
of each company’s website at Bristol-Myers Squibb
https://www.bms.com/investors.html and Celgene
https://ir.celgene.com/investors/default.aspx as well as a joint
transaction website at www.bestofbiopharma.com.
About Bristol-Myers Squibb
Bristol-Myers Squibb is a global biopharmaceutical company whose
mission is to discover, develop and deliver innovative medicines
that help patients prevail over serious diseases. For more
information about Bristol-Myers Squibb, visit us
at BMS.com or follow us on LinkedIn, Twitter, YouTube and
Facebook.
About Celgene
Celgene Corporation, headquartered in Summit, New Jersey, is an
integrated global biopharmaceutical company engaged primarily in
the discovery, development and commercialization of innovative
therapies for the treatment of cancer and inflammatory diseases
through next-generation solutions in protein homeostasis,
immuno-oncology, epigenetics, immunology and neuro-inflammation.
For more information, please visit www.celgene.com. Follow
Celgene on Social Media: @Celgene, Pinterest, LinkedIn, Facebook
and YouTube
Important Information For Investors And Stockholders
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval. It does not constitute a prospectus or
prospectus equivalent document. No offering of securities shall be
made except by means of a prospectus meeting the requirements of
Section 10 of the U.S. Securities Act of 1933, as amended.
In connection with the proposed transaction between
Bristol-Myers Squibb Company (“Bristol-Myers Squibb”) and Celgene
Corporation (“Celgene”), Bristol-Myers Squibb and Celgene will file
relevant materials with the Securities and Exchange Commission (the
“SEC”), including a Bristol-Myers Squibb registration statement on
Form S-4 that will include a joint proxy statement of Bristol-Myers
Squibb and Celgene that also constitutes a prospectus of
Bristol-Myers Squibb, and a definitive joint proxy
statement/prospectus will be mailed to stockholders of
Bristol-Myers Squibb and Celgene. INVESTORS AND SECURITY HOLDERS OF
BRISTOL-MYERS SQUIBB AND CELGENE ARE URGED TO READ THE JOINT PROXY
STATEMENT/PROSPECTUS AND OTHER DOCUMENTS THAT WILL BE FILED WITH
THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and
security holders will be able to obtain free copies of the
registration statement and the joint proxy statement/prospectus
(when available) and other documents filed with the SEC by
Bristol-Myers Squibb or Celgene through the website maintained by
the SEC at http://www.sec.gov. Copies of the documents filed with
the SEC by Bristol-Myers Squibb will be available free of charge on
Bristol-Myers Squibb’s internet website at https://www.bms.com/
under the tab, “Investors” and under the heading “Financial
Reporting” and subheading “SEC Filings” or by contacting
Bristol-Myers Squibb’s Investor Relations Department through
https://www.bms.com/investors/investor-contacts.html. Copies of the
documents filed with the SEC by Celgene will be available free of
charge on Celgene’s internet website at https://www.celgene.com/
under the tab “Investors” and under the heading “Financial
Information” and subheading “SEC Filings” or by contacting
Celgene’s Investor Relations Department at ir@celgene.com.
Certain Information Regarding Participants
Bristol-Myers Squibb, Celgene, and their respective directors
and executive officers may be considered participants in the
solicitation of proxies in connection with the proposed
transaction. Information about the directors and executive officers
of Bristol-Myers Squibb is set forth in its Annual Report on Form
10-K for the year ended December 31, 2017, which was filed with the
SEC on February 13, 2018, its proxy statement for its 2018 annual
meeting of stockholders, which was filed with the SEC on March 22,
2018, and its Current Report on Form 8-K, which was filed with the
SEC on August 28, 2018. Information about the directors and
executive officers of Celgene is set forth in its Annual Report on
Form 10-K for the year ended December 31, 2017, which was filed
with the SEC on February 7, 2018, its proxy statement for its 2018
annual meeting of stockholders, which was filed with the SEC on
April 30, 2018, and its Current Reports on Form 8-K, which were
filed with the SEC on June 1, 2018, June 19, 2018 and November 2,
2018. Other information regarding the participants in the
proxy solicitations and a description of their direct and indirect
interests, by security holdings or otherwise, will be contained in
the joint proxy statement/prospectus and other relevant materials
to be filed with the SEC regarding the proposed transaction when
they become available. You may obtain these documents (when they
become available) free of charge through the website maintained by
the SEC at http://www.sec.gov and from Investor Relations at
Bristol-Myers Squibb or Celgene as described above.
Cautionary Statement Regarding Forward-Looking
Statements
This communication contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. You can generally identify forward-looking statements
by the use of forward-looking terminology such as “anticipate,”
“believe,” “continue,” “could,” “estimate,” “expect,” “explore,”
“evaluate,” “intend,” “may,” “might,” “plan,” “potential,”
“predict,” “project,” “seek,” “should,” or “will,” or the negative
thereof or other variations thereon or comparable
terminology. These forward-looking statements are only
predictions and involve known and unknown risks and uncertainties,
many of which are beyond Bristol-Myers Squibb’s and Celgene’s
control. Statements in this communication regarding Bristol-Myers
Squibb, Celgene and the combined company that are forward-looking,
including projections as to the anticipated benefits of the
proposed transaction, the impact of the proposed transaction on
Bristol-Myers Squibb’s and Celgene’s business and future financial
and operating results, the amount and timing of synergies from the
proposed transaction, the terms and scope of the expected financing
for the proposed transaction, the aggregate amount of indebtedness
of the combined company following the closing of the proposed
transaction, expectations regarding cash flow generation, accretion
to non-GAAP earnings per share, capital structure, debt repayment,
adjusted leverage ratio and credit ratings following the closing of
the proposed transaction, Bristol-Myers Squibb’s ability and intent
to conduct a share repurchase program and declare future dividend
payments, the combined company’s pipeline, intellectual property
protection and R&D spend, the timing and probability of a
payment pursuant to the contingent value right consideration, and
the closing date for the proposed transaction, are based on
management’s estimates, assumptions and projections, and are
subject to significant uncertainties and other factors, many of
which are beyond Bristol-Myers Squibb’s and Celgene’s control.
These factors include, among other things, effects of the
continuing implementation of governmental laws and regulations
related to Medicare, Medicaid, Medicaid managed care organizations
and entities under the Public Health Service 340B program,
pharmaceutical rebates and reimbursement, market factors,
competitive product development and approvals, pricing controls and
pressures (including changes in rules and practices of managed care
groups and institutional and governmental purchasers), economic
conditions such as interest rate and currency exchange rate
fluctuations, judicial decisions, claims and concerns that may
arise regarding the safety and efficacy of in-line products and
product candidates, changes to wholesaler inventory levels,
variability in data provided by third parties, changes in, and
interpretation of, governmental regulations and legislation
affecting domestic or foreign operations, including tax
obligations, changes to business or tax planning strategies,
difficulties and delays in product development, manufacturing or
sales including any potential future recalls, patent positions and
the ultimate outcome of any litigation matter. These factors also
include the combined company’s ability to execute successfully its
strategic plans, including its business development strategy, the
expiration of patents or data protection on certain products,
including assumptions about the combined company’s ability to
retain patent exclusivity of certain products, the impact and
result of governmental investigations, the combined company’s
ability to obtain necessary regulatory approvals or obtaining these
without delay, the risk that the combined company’s products prove
to be commercially successful or that contractual milestones will
be achieved. Similarly, there are uncertainties relating to a
number of other important factors, including: results of clinical
trials and preclinical studies, including subsequent analysis of
existing data and new data received from ongoing and future
studies; the content and timing of decisions made by the U.S. FDA
and other regulatory authorities, investigational review boards at
clinical trial sites and publication review bodies; the ability to
enroll patients in planned clinical trials; unplanned cash
requirements and expenditures; competitive factors; the ability to
obtain, maintain and enforce patent and other intellectual property
protection for any product candidates; the ability to maintain key
collaborations; and general economic and market conditions.
Additional information concerning these risks, uncertainties and
assumptions can be found in Bristol-Myers Squibb’s and Celgene’s
respective filings with the SEC, including the risk factors
discussed in Bristol-Myers Squibb’s and Celgene’s most recent
Annual Reports on Form 10-K, as updated by their Quarterly Reports
on Form 10-Q and future filings with the SEC. It should also be
noted that projected financial information for the combined
businesses of Bristol-Myers Squibb and Celgene is based on
management’s estimates, assumptions and projections and has not
been prepared in conformance with the applicable accounting
requirements of Regulation S-X relating to pro forma financial
information, and the required pro forma adjustments have not been
applied and are not reflected therein. None of this information
should be considered in isolation from, or as a substitute for, the
historical financial statements of Bristol-Myers Squibb or Celgene.
Important risk factors could cause actual future results and other
future events to differ materially from those currently estimated
by management, including, but not limited to, the risks that: a
condition to the closing of the proposed acquisition may not be
satisfied; a regulatory approval that may be required for the
proposed acquisition is delayed, is not obtained or is obtained
subject to conditions that are not anticipated; Bristol-Myers
Squibb is unable to achieve the synergies and value creation
contemplated by the proposed acquisition; Bristol-Myers Squibb is
unable to promptly and effectively integrate Celgene’s businesses;
management’s time and attention is diverted on transaction-related
issues; disruption from the transaction makes it more difficult to
maintain business, contractual and operational relationships; the
credit ratings of the combined company declines following the
proposed acquisition; legal proceedings are instituted against
Bristol-Myers Squibb, Celgene or the combined company;
Bristol-Myers Squibb, Celgene or the combined company is unable to
retain key personnel; and the announcement or the consummation of
the proposed acquisition has a negative effect on the market price
of the capital stock of Bristol-Myers Squibb and Celgene or on
Bristol-Myers Squibb’s and Celgene’s operating results. No
assurances can be given that any of the events anticipated by the
forward-looking statements will transpire or occur, or if any of
them do occur, what impact they will have on the results of
operations, financial condition or cash flows of Bristol-Myers
Squibb or Celgene. Should any risks and uncertainties develop
into actual events, these developments could have a material
adverse effect on the proposed transaction and/or Bristol-Myers
Squibb or Celgene, Bristol-Myers Squibb’s ability to successfully
complete the proposed transaction and/or realize the expected
benefits from the proposed transaction. You are cautioned not to
rely on Bristol-Myers Squibb’s and Celgene’s forward-looking
statements. These forward-looking statements are and will be based
upon management’s then-current views and assumptions regarding
future events and operating performance, and are applicable only as
of the dates of such statements. Neither Bristol-Myers Squibb nor
Celgene assumes any duty to update or revise forward-looking
statements, whether as a result of new information, future events
or otherwise, as of any future date.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190103005311/en/
BRISTOL-MYERS SQUIBBMedia:Laura
Hortas609-252-4587laura.hortas@bms.comInvestors:Tim
Power609-252-7509timothy.power@bms.comCELGENEInvestors:908-673-9628ir@celgene.comorMedia:908-673-2275media@celgene.com
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