The Cross-Border Biotech Blog

Biotechnology, Health and Business in Canada, the United States and Worldwide

Tag Archives: Bristol-Myers Squibb

Monday Biotech Deal Review: February 7, 2011

Welcome to your Monday Biotech Deal Review for February 7, 2011.  It was a fairly busy week for Canadian biotech – Angiotech has followed suit in the U.S. on the heels of last week’s CCAA filing, a number of acquisitions were announced, and there was some activity in biotech licensing.  Read on to learn more.  Read more of this post

Monday Biotech Deal Review: October 11, 2010

Happy (Canadian) Thanksgiving!  This Monday Biotech Deal Review reports that it was a bad week for turkeys and a bit of a slow week on the biotech front, but read on to learn about some interesting collaborations, allegations and corporate immigrations. Read more of this post

Bristol-Myers Squibb Strikes $2.1 billion Deal for Medarex

light at the end of the tunnel smallGreat news for Medarex shareholders from BMS’ $16/share offer yesterday, which clocks in at a 90% premium over Wednesday’s close.  Reports cite the value of ipilimumab, a late-stage cancer therapy being advanced as a new treatment for metastatic melanoma, as well as the value of Medarex’s transgenic mouse platform to make human antibodies.

However, the deal is better for BMS than the headline price per share indicates. 

First, discount $300 million of the $2.4 billion that pays for Medarex’s cash and liquid securities.

Second, look at BMS’ cost savings here, since they were already partnered with Medarex on ipilimumab.  According to reports at the time the partnership was struck:

“Medarex has an option to co-promote ipilimumab in the U.S., where the company would receive 45 percent of profits. Bristol-Myers Squibb would get the rest and pay an undisclosed royalty back to Medarex on overseas sales. The company received an initial $50 million payment and could earn up to $480 million in regulatory and sales milestones.”

Figure the NPV of the $480 million is a lot higher now than it was in 2005, add in 45% of the U.S. market, and the 90% premium shrinks considerably.  I also wonder if the value of Medarex’s deal with Lonza is (a) transferable (more change-of-control clause fun) and (b) higher to BMS than it is to Medarex.

Other good news: This continues the “biotech is a good investment” meme shaping up this week.  Forbes asks “who’s next” in what DailyFinance calls “[t]he heated-up biotech sector,” and Cell Therapeutics thinks this is a great time to be in the market and is looking to sell $40 million or so of equity.

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Trends Update — Comparative Effectiveness and Personalized Medicine: Genetic Test Identifies Patient Subpopulation for Benefit, Avoids Wasted Money and Time for Others on Erbitux, Vectibix

B&W_DNA_sequenceThis is exactly how personalized medicine and comparative effectiveness can interact to benefit patients, pharma companies and payors:

  • data shows that patients with KRAS mutations don’t benefit from anti-EGFR antibody meds Erbitux or Vectibix;
  • the FDA approves a labeling change identifying the patients who won’t benefit;
  • payors see costs savings from eliminating pointless prescriptions;
  • patients without the KRAS mutations have added incentive to take the drugs, benefiting themselves and the pharma companies who make the drugs.

As the WSJ Health Blog says:

“Erbitux and other expensive cancer medicines have faced repeated questions about whether drugs that prolong life for short periods of time are worth the high costs… Not using Erbitux as a first-line treatment for [KRAS-variant] patients could save about $600 million a year.”

The manufacturers Bloomberg’s reporter spoke to are fully supportive:

“‘The inclusion of KRAS as a biomarker in the Erbitux labeling helps physicians to better understand the most appropriate use of the drug in the management of patients with metastatic colorectal cancer,’ said Fouad Namouni, an oncology executive for Bristol-Myers …

Physicians can eliminate Vectibix and Erbitux for colon cancer patients with the KRAS mutation and ‘redirect those patients to alternative therapies, avoiding unnecessary treatments in patients who are unlikely to benefit,’ said Sean Harper, Amgen’s chief medical officer.”

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Wednesday Brain Dump: Around the World Edition

M&A Update

Following our last update, there have been a considerable number of bio/pharma M&A developments, so to bring you up to speed here is the latest deal info we’ve found…

It’s Raining M&A

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