BY Richard Summerfield
Bristol Myers Squibb has agreed to acquire cancer drug manufacturer Mirati Therapeutics in a deal worth $4.8bn. The acquisition will see Bristol Myers Squibb diversify its oncology business with lung cancer drug Krazati, which was approved by the US Food and Drug Administration (FDA) in December. A second compound – MRTX1719 – which could be used in some types of lung cancer was also attractive to the company.
Under the terms of the deal, Bristol Myers Squibb will pay $58 per share in cash, for a total equity value of $4.8bn. Mirati stockholders will also receive one non-tradeable contingent value right (CVR) for each Mirati share held, potentially worth $12 per share in cash, representing an additional $1bn of value opportunity. The transaction was unanimously approved by both the Bristol Myers Squibb and the Mirati boards of directors.
According to a statement announcing the deal, Bristol Myers Squibb expects to finance the acquisition with a combination of cash and debt. The deal is expected to be dilutive to the company’s non-generally accepted accounting principles (GAAP) earnings per share by approximately 35 cents per share in the first 12 months after the transaction closes, the statement added.
“We are excited to add these assets to our portfolio and to accelerate their development as we seek to deliver more treatments for cancer patients,” said Giovanni Caforio, chief executive and board chair of Bristol Myers Squibb. “With a strong strategic fit, great science and clear value creation opportunities for our shareholders, the Mirati transaction is aligned with our business development goals. Importantly, by leveraging our skills and capabilities, including our global commercial infrastructure, we will ensure patients globally can benefit from Mirati’s portfolio of innovative medicines.”
“Since our founding 10 years ago, Mirati has made significant strides in transforming the lives of patients living with cancer through the development of innovative therapies,” said Charles Baum, founder, president and chief executive of Mirati Therapeutics, Inc. “Through our discovery and development of next-generation targeted cancer therapeutics, we have built a robust pipeline of potentially best-in-class treatments that offer renewed hope for patients. This transaction is a testament to the potential of our platform and to our team’s hard work and dedication to changing lives.
“Bristol Myers Squibb’s global scale, resources and commitment to innovation will enable Mirati’s therapeutics to benefit more patients, faster, and deliver on our vision of unlocking the science behind the promise of a life beyond cancer. We believe that this transaction is the best way to benefit patients and maximize value for shareholders,” he added.
“Mirati strengthens and complements our current portfolio by adding assets focused on intrinsic tumor targets in the MTAP and MAPK pathways,” said Samit Hirawat, chief medical officer and head of global drug development at Bristol Myers Squibb. “We believe Mirati’s assets have the potential to change the standard of care in multiple cancers, both as standalone therapies and in combination with Bristol Myers Squibb’s existing pipeline. We are excited about the significant potential that this transaction creates to transform patients’ lives through science around the world.”
News: Bristol-Myers Squibb to acquire Mirati in up to $5.8 billion deal