The Big Red Biotech Blog

M&A Activity - Usual Suspects

Fierce Biotech reports on latest Moody analyst's take on M&A activity for 2013 in the pharma industry. The news was similar to predictions that I've seen for the past couple of years -- that being a few cash flush Big Pharma players will be looking for bolt on acquisitions from the biotech flock to bolster their pipelines -- to help fill in lost sales due to patent expirations within the existing product portfolio.

Potential big acquirers on the latest list included: Pfizer, Novartis, Roche and AstraZeneca. Their purposrted prey might include these analysts favorites: Theravance, Onyx Pharmaceuticals and Cubist Pharmaceuticals. There is no particular word out there that this is actually happening as we speak but these companies have profiles the analysts love to love as acquisition targets due to their relatively smaller size, existing commercial products and current pipelines.

In the past (May 2011), rumors have circulated that AZ was interested in buying Cubist for its antibiotics versus MRSA.  So some of the candidate deals on the table are not new notions -- at least for analysts.

Posted by Bruce Lehr Apr 23rd 2013.

AZ Crashes into Speed Bump in Earnings

AstraZeneca reported its fourth quarter earnings today and it was a t least as bad as the analysts had expected.  And according to CEO Pascal Soriot, you can expect more downturn into next year too with a "mid- to high- single digit percentage" drop in sales.

AZ has already announced that it is killing a few big program in its pipeline. Soriot further communicated that is will not be buying back its own stock and will watch its dividends.  But to soften blow, profit magins will also suffer. What?

Soriot says, "We will be open to more disruptive acquisitions, larger acquisitions if they make sense."  Analysts quickly latched onto companies like Shire being a possible target -- such an acquisition would be expensive and much more than the $20 B mark being propped up as the current barrier Big Pharma wished to stay under. 

Surprisingly, AZ stock only dropped about 2.7% -- maybe all discounting has already occurred.  Need to check to see if Shire is going in the other direction or not.  But if you are a company with asserts to sell -- good or bad -- you might want to get Soriot on speed dial. This is especially true if you have more than a $20 B property to move as analysts believe there won't be much competition up in that stratosphere.  Likely true. See Fierce Biotech and In the Pipeline.

Posted by Bruce Lehr Jan 31st 2013.

Report on 2012 Biotech M&A

The LifeSci blog reported this morning on some key statistics and trends in Biotech M&A in 2012.  Not surprisingly, some data were good, some bad and some ugly (according to LifeSci).  Here's the summary:

• Median investor multiples in the US have risen from 1.2x in 2005, to 2.5x in 2011 to a nice 3.5x in 2012.  Going my way?
• Unfortunately, this is NOT the case in Europe where the comparable 2012 figure was only 1.3x
• The ugly trend is that the time from founding the company to trade sale is lengthening -- from about 5 years in 2005 to more than 9 years in 2012.  Looks similar to trend line for FDA approvals on new drugs.  Coincidence?

Posted by Bruce Lehr Jan 30th 2013.

More Big Pharma Woes Decried

Big Pharma performance continues to receive muted reviews from various analysts and industry commentators.  Pharma Reform starts with an analysis of drug approvals in 2012 by FDA.  It is TRUE that 35 drugs were approved last year.  It is also TRUE that this represents the fruit of only 31 sponsoring companies and only 13 of these 35 could be classified (somewhat generously) as Big Pharma. Of 12 priority approvals, only 4 came from Big Pharma. How about discovery?  Of the 35 new approvals, only 7 (20%) came from Big Pharma. So while the total number of approvals in 2012 is slightly up from previous years -- is Big Pharma actually doing any better? 

PharmaTech Talk chimes in with a piece describing how Big Pharma's "firepower" -- i.e. ability to compete and conduct M&As -- has been reduced.  Partly this is caused by Big Pharma's lack of growth. In 2011, the overall drug market saw growth that exceeded Big Pharma's by $20 B.  In 2012, this is expected to have widened to $50 B and predictions are that it will reach $100 B by 2015.  This is largely due to the much discussed patent cliff and lack of replacment product revenues in Big Pharma pipelines. So of course, Big Pharma should bail itself out with M&As right?  Wrong according to Ernst & Young. Big Pharma's firepower according to their calculations has decreased by 23% between 2006 and 2012. Specialty pharma and biotechs have become much more hardy competition and have increased their firepower. So now, Big Pharma might get bumped from M&A deals they heretofor would have taken if they wished. Uh-oh.

That means more bolt-on deals, more divesititures, and more offshore deals in emerging markets. Big Pharma will need to pursue actions that boost and conserve firepower if it wishes to pursue transactions that require it to bail themselves out of revenue holes.

Posted by Bruce Lehr Jan 9th 2013.

Can a Young Biotech Go Long?

YES! That's the answer given by Katrine Bosley, former CEO of Avila Therapeutics, in a piece in today's Xconomy.

I liked her whole perspective in the piece.  She argues that if a company's management focuses on creating value -- then they will have the chance to grow into a fully integrated pharmaceutical company (FIPCO) or they may also be offered opportunities for other types of deals including being acquired.  The key is to focus on the value creation first -- so you will have something tangible to consider in making a 'go long" or M&A decision. 

If you do create value, you could have the chance to become an Ironwood, Aveo, Regeneron, or Onyx Pharmaceuticals. Or you coudl get a good purchase offer from a big pharma partner that is a good fit like those realized by Plexxikon, Adnexus, Avila, Intellikine, or Calistoga. 

Either way you can be successful in bringing new medicines to market and pleasing your investors.

Posted by Bruce Lehr Dec 20th

 

When Your Sales Drop 19% YOY Buy Pipeline Assets

Baron Nathan Rothschild famously told clients "buy when there is blood in the streets, even if its your own."

AZ CEO Pascal Seriot seems to have taken this to heart.  He told reporters after the company reported a huge 19% drop in its sales for the latest quarter, "One of the critical things we need to do in the mid-term is to bolster our pipeline and that will rely on business development activities, there is no question about it."

As a result, AZ squashed a plan to buyback its own stock.  In the near past, it licensed rights to Amylin's diabetes portfolio, and partnered with Ironwood on that company's drug linaclotide in China. It licensed Ardelyx's CKD drug for $272 M, bought Ardea and signed a deal with Regulus. 

Now it is rumored to be lookng to buy Amarin, and has been linked to possible purchases of Forest Laboratories and Shire. The Baron might be proud should this come to pass. See Fierce Biotech.

Posted by Bruce Lehr Oct 28th 2012.

 

 

 

BMS and AZ Team up to Buy Amylin at Premium

This one caught me by surprise evn though it was known that Amylin was actively soliciting bids for its own acquisition.  Late Friday, Bristol Myers Squibb announced it was acquiring Amylin for $5.3 B plus paying Eli Lilly about $1.7 B in olbigations to acquire Amylin and its diabetes treatments Byetta and Bydureon. 

Then is was also announced that AstraZeneca will pay BMS $3.5 B to share in the profits of the the two drugs. The deal represented about a 10% premium over Amylin's closing price on Friday.  Some analysts were scratching their heads at the size of this deal for a company like Amylin -- that has had more than its share of trials. 

However, desperate times sometimes call for desperate measures, and there are few companies in Big Pharma land more desperate than AZ for some new products and revenue streams.  Their pipeline and R&D productivity has been characterized as the industry's worst.  At a time when key drugs are coming off patent, they need the shot in the arm so to speak and will get two diabetes drugs from the deal.

The only compnay perhaps looking at a steeper patent cliff than AZ, would be Eli Lilly. They didn't pick up any products in the deal but did get out from being owed a large debt by Amylin and now have $1.7 B more in their pockets to invest. See Xconomy, Pharmalot and PharmaGossip here and here.

Posted by Bruce Lehr Jun 30th 2012.

Biotech Markets and Funding

Here's a good article by Bruce Booth of the Life Sci VC blog discussing the heyday of IPOs in the 1991-1994 span versus, the history of these deals to date, and the current investment environment.  What's the story?

IPOs of that era paid handsomely to the VC backers of the time.  The average step-up in valuation over the private invested capital was -- 4x.   There was a very low cost-of-capital provided by public equity investors in that period. Much lower than today.  For most of the past decade, step-ups on total invested capital have typically been only 1.5x or so.  Sadly, high capital intensity has been the signature of many of the past decade’s IPO stories.

The playing field has changed since then as investors realized over that time span that only a subset of the 1991-1994 IPO window have accrued real value over time.  Gilead, MedImmune and Vertex might be considered notable exceptions.  Most of the other IPOs have underperformed all the major indices.

 Booth instructs that there is a major flaw in the former IPO model that 3 main features:

• high capital intensity funding large portfolios, requiring serial public equity, with little focus on capital efficiency
• endless cycles of “rinse and repeat” anti-shareholder behaviors where new investors are recruited to fund the promise at the expense of existing shareholder dilution
• management teams too focused on “built-to-last” company survival vs shareholder value maximization, even when the best outcome for existing shareholders, and often patients, is to sell now and access the balance sheet resources of a bigger company

These flaws have led to IPOs a less attractive means of fudning.  As Booth says, if most IPOs trade down after their IPOs, why bother buying at the offering.  Seems rational.  So in the current environment, private backers are becoming more activist and push for strategies that maximize their return in these companies -- which includes the proposition of selling the company "realtively early" to big pharma players. This avoids the dilution problem described above if trying to go the long haul.  The old IPO model is gone.

In the current situation, one of the big change drivers is Big Pharma R&D productivity issues and their increasingly active M&A interests.  Big Pharma in recent weeks has tried to make deals for Human Genome Sciences, Amylin and Illumina -- but were thwarted by big shareholder interests. As described above, activist big shareholders are playing a larger role in trying to maximize their investments and have resisted these perceived "low ball" offers. With more buyers crowding into the market, the pressure to pay a premium is just going to go higher. That's a trend with which biotech investors are well attuned.  See Fierce Biotech. 

Posted by Bruce Lehr May 5th 2012

 

 

New Drugs -- If You Can't Make 'Em, Buy 'Em

That seems to be the current motto of many big pharma companies and describes their relationship to biotechs.  But if you go that route, you will pay handsomely.  Fierce Biotech reports (via Bloomberg) that pharma companies are forking over on average a 71% premium in picking up new biotechs (worth > $500 M) for their pipelines.  This is reportdly the highest premium since 2000. 

So if you read the previous post about "bad culture" in Big Pharma, another cost (beyond poor R&D productivity) seems to be having to pay the piper when it comes to buying from the biotechs. Cutting the R&D budget likely won't help rectify that -- although it may help fund it a bit. 

Supply and demand is taking over and the acquisition prices will keep rising as a result in the short term.

Posted by Bruce Lehr Apr 25th 2012.

Bye Bye Baby -- Roche Walks after Illumina Turndown

Xconomy reports that Roche will no longer on Illumina to embrace its acquisition offer of $51 per share. Now Roche has pledged to walk when its offer expires at 6pm on Friday this week -- having already sweetened its original offer of $44.50 per share. 

On the news, Illumina stock dropped 5% today (presumably takeover speculators) and is now trading at $41.83 per share. Illumina says its management team and board is "confident in delivering outperformance relative to guidance and in returning to long-term growth..."  

Roche says Bye Bye Baby Bye Bye.

 

Posted by Bruce Lehr Apr 18th 2012

WSJ Reports BMS Still Interested in Amylin

Today's WSJ reports Bristol-Myers Squibb is still interested in acquiring Amylin (mkt cap $3.6 B) -- as one of its larger pearls.  Amylin reportedly turned down and offer from BMS earlier this year of $3.5 B -- which has triggered some furor among its shareholders -- notably one Carl Icahn who owns about 9% of the company's shares.

Amylin's lead drugs Byetta and Bydureon for the treatment of diabetes would help complement the BMS offer that includes drugs like Onglyza (co-marketed with AstraZeneca) and a drug under development called dapagliflozin.  The world wide diabetes market is expected by IMS to reach up to $48 B by 2015 -- making an Amylin acquisition attractive to BMS to replace revenue losses from medicines with expiring drug patents.  In that regard, Amylin would appear to fit neatly into BMS' string of pearls strategy for growth.

Posted by Bruce Lehr Apr 6th 2012.

Amylin Acquisition Comments Consolidated

By now you all know that Amylin is rumored to be in play after word was leaked that the company recently turned down a $3.5 B offer from BMS to be acquired.  Once word hit the market, Amylin's stock price shot up by 55% yesterday to $23.77 per share.

Will Amylin Be Acquired? W hat The Wags Say… // Pharmalot.

Now various analysts are weighing in on how an acquisition of Amylin by a member of big pharma makes ultimate sense.  It is acknowledged that the BMS offer starts the floor price for bidding and a final sales price would make sense in the $25-$30 per share range (most folks tending toward low end of the range).  Companies mentioned as potential suitors include AstraZeneca, Roche, Novartis, Takeda, Johnson & Johnson, and Sanofi to at least consider a bid.

AstraZeneca has also been mentioned as a possible partner who could sign up to help Amylin represent its product in the EU.  If that were to occur, Amylin may not have to or choose to sell under those circumstances.  See Seeking Alpha stories one and two, and Fierce Biotech.

Given the revenue gaps being experienced by some of the companies above and their strength in selling to the diabetes market, odds seems to be good that one of these companies may make a higher offer.  Since, Amylin stock was at $15+ per share only a few days ago, it will be hard for their board to justifying a rejection of another offer in the mid-20's.

Posted by Bruce Lehr Mar 29th 2012.

Hep C Companies Rumored as Next Takeovers

Fierce Biotech reported today on the continued hype by investors and analysts for the companies that are pursuing hepatitis C therapies and have gotten good clinical (or preclinical) results.  Two of the leaders who have not yet been swallowed, Achillion and Idenix, are rumored to be takeover targets as big pharma suitors cast an eye toward a purported $20 billion hepatitis C treatment market.

Achillion's CEO, Michael Kishbauch, is out shopping the company to large, as yet unnamed, players. He says he is looking for a premium that would "put a silly grin on all our faces."  He might just get it too.  But other Big Pharma CEO's like Sanofi's Viehbacher are saying the premium's are too high and the value is not there.  This is echoed by GSK's Moncef Slaoui, R&D chief. 

Next thing you know, Sanofi and GSK will be putting in a bid. 

Posted by Bruce Lehr Feb 15th 2012.

Is 2012 a Biotech Buyout Year in Making?

Statements from the recently concluded JP Morgan conference indicate that many big pharma BD groups are actively seeking to purchase biotechs in 2012 as a means of extending their pipelines.  An industry analyst observed that there are 18 biotechs trading at only twice the value of their cash reserves.

Companies that have been named by industry observers as potential acquisition candidates include GenMab, Active Biotech, and Achillion.  Big Pharma players who have indicated they are in buying mode include BMS' CEO Lamberto Andreotti with its continuing "string of pearls" strategy, Roche's CEO Schwan indicates a $3 B budget for aquisitions, Sanofi's Viehbacher has $2.6 B set aside, and Novartis' Jimenez says they could spend $2 B - $3 B. Biogen's CEO Scangos also indicates their willingness to go out and buy early stage assets to compliment the later stages of their pipeline. See Fierce Biotech.

Early indications are that there should be good activity in the M&A arena in 2012.

Posted by Bruce Lehr Jan 13th 2012.

"Wee Willie" Viehbacher on Pharma Investing?

My mind sometimes works in strange and mysterious ways.  I was reading Fierce Biotech this morning and saw that Chris Viehbacher indicated that Sanofi will spend up to $2.6 B on acquisitions next year -- at least that is the budget for a more limited "string of pearls" strategy. 

But I had to smile when he was quoted in the article as saying, "The trick in M&A is to go find something not everybody is looking at."

I will now dub this, in homage to Wee Willie Keeler, the "Buy 'em where they ain't" strategy.

 

Posted by Bruce Lehr Jan 12th 2012.

Sanofi Chases Cheaper String of Pearls

BMS has touted its so called "string of pearls" business development model for building its pharma business over the past few years -- successes include the Medarex (Yervoy approval) and Adnexus Therapeutics.  And, the BMS stock price has responded favorably - enough so to embolden the just announced deal for Inhibitex at $2.5 B.

Competitors -- who may not have been sold when the strategy was first being touted -- seem to be more inspired.  Teva recently hired BMS' chief dealmaker as its CEO to direct its future strategy for growth.  Merck has also indicated it may be working on its own pearls by declaring it is in the market for big and small companies to augment its assets.

Now Sanofi CEO, Chris Viehbacher says he is looking at his own "string of pearls" strategy in apparent homage to BMS but will look to do so with a "mere" $2.6 B in available cash for 2012. Viehbacher though is looking both inside and outside biotech assets and doesn't want to go after any big oysters preferring perhaps assets with lesser luster but more affordability.  See Fierce Biotech.

Just another designer knock-off I guess.

Posted by Bruce Lehr Jan 11th 2012.  

Does Big Pharma Have More Dollars Than Sense?

On the heels of BMS acquisition of a Phase 1 hepatitis C therapy through its $2.5 B acquisition of Inhibitex, some industry naysayers question whether the risk is worth it at such an early stage and such a high price (Gilead's $11 B buy of Pharmasset can also be thrown into the discussion). It looks like the competitive bidding embodied by "auction fever" may be taking over as some company's scramble to fill in their revenue holes.

Pharma Pays A Premium For Its Shopping Spree // Pharmalot.

Analysts note that Pharma in general pays a 44% premium in their takeover efforts with biopharma -- as compared to 26 percent in other industries. That may seem eye popping to some but is nothing compared to the 89% premium that Gilead's purchase represents and BMS upped the bar to a 163% premium for Inhibitex. 

Investors and analysts can now hold their breath for several years to see if these deals pay off or not -- there will always be plenty of ammunition available for second guessing if it doesn't work out.

Posted by Bruce Lehr Jan 11th 2012.

 

Hepatitis C Deals Take Center Stage

Market analysts have projected that sales of products that are newly on the market or in late phase clinicals to treat hepatitis C could have worldwide sales in excess of $20 B by 2020. That's a big number! See Pharmalot.

So it is easy to see why more deals are happening in this area with a few more possibilities looming.  In just the past few weeks and months, Gilead bought Pharmasset for its PSI-7977 therapy for $11 B.  BMS followed suit to buy Inhibitex for its phase I hepatitis C drug for an impressive $2.5 B - a startling sum for a phase I compound that is still years from the market. Both acquiring companies are trying to introduce an oral hepatitis C treatment that does NOT rely on interferon (and its well described side-effects). See Fierce Biotech and PharmaGossip.

Now Merck is rumored to be a leading suitor to buy perhaps, Achillion for its hepatitis C treatments.  This would add to Merck's newly approved Victrellis and its mid-stage drug MK-5172 still in development. Merck also had previously announced a collaboration with Roche.

Said Merck's Roger Pomeranz at a recent JP Morgan Healthcare Conference, "Our goal is to be a leader in hepatitis C, and we will do what it takes to get there."  Merck is ready to do small or larger deals to rapidly build its position.  See Fierce Biotech.

The Game is On.

Posted by Bruce Lehr Jan 10th 2012.

Sigma-Aldrich to Acquire BioReliance

Sigma-Aldrich will add BioReliance to its portfolio of products and services aimed at supporting the development of biological drugs.  The deal adds BioReliance's $110 M in revenues in the biopharm space and projected double digit growth for 2012 to Sigma's coffers for a cash price of $350 M.

Sigma-Aldrich to offer start to finish bio-testing thanks to BioReliance takeover.

The SAFC group within Sigma-Aldrich focuses on the supply of raw materials to make pharmaceuticals and biopharmaceuticals, does some process development, and offers contract manufacturing and testing services.  BioReliance's capabilities in biologics testing, specializes toxicology and in animal health testing will add to SAFC's portfolio.  In particular, SAFC will now be able to support testing of both raw materials and final product.

In the production of biological drugs, the combined companies can work together as well in areas like cell line development, banking and testing to support biologics processes -- as well as provide more extensive testing and characterization of final product produced in SAFC plants.  Plus with the burgeoning biosimilars area, the combined group will be able to collaborate in areas like glycoanalysis to support product comparability or "biosimilarity".

It's an exciting combination that may promote more of a "one-stop-shop" menu of services to existing clients. Said Sigma-Aldrich President and CEO, Rakesh Sachdev, "As the market continues its focus on biological drug development, our leadership in this area should enable us to build even better, more customer-specific solutions."

Download Press Release_BioReliance_010912[1]

 

Posted by Bruce Lehr Jan 10th 2012.

Place Your Bets on the Onyx Auction Winner

According to Fierce Biotech, GSK or Pfizer have been named as the front runners by industry observers as most likely to acquire Onyx.  Takeda was also mentioned as being in the race. Onyx makes Nexavar (kidney cancer) and has the hotly watched carfilzomib (multiple myeloma) under FDA review.  Analysts project Onyx revenues more than doubling in the next 5 years. 

That will help any acquirer fill in some of those nasty revenue potholes caused by drugs going over the patent cliff. Let the bidding begin and place your bets on the winner.

Posted by Bruce Lehr Dec 1st 2011.

Wall Street Elements Floating BMS Acquisition Rumors

Ok, so technically this probably isn't a rumor.  But, Fierce Biotech did report today on comments from the Wall Street analysts from Jeffries that BMS is doing so well that it would be a likely acquisition candidate.  I'm not sure how much difference there is between them actually being in play and having  influencial analysts group suggest 'they should be in play'.

In any event, on the heels of BMS' good fortune in getting Yervoy approved for the treatment of advanced melanoma, as well as making out with Eliquis (apixiban) for anti-clotting, the Fierce article names Pfizer as a Big Pharma company likely to be excited to acquire BMS.  This is largely explained due to BMS expected improved positive cash flow from the above drugs as they penetrate the market, coupled with Pfizer's own cash flow dearth's resulting from drugs like Lipitor going generic.

And conveniently, Pfizer is partnered on Eliquis with BMS.  A match made in pharma heaven eh?  I don't know.  I would have thought Pfizer learned a lesson on downsides of its last two mega-deals with Pharmacia and Wyeth. But what do I know?

 

Posted by Bruce Lehr Sep 19th 2011.

CureTech's Plus Results Equal Teva's Investment

CureTech, in reporting positive results for its CT-011, anti-PD-1, therapy against relapsed lymphoma, spurred Teva to increase its investment in the company by another $19 M.  Teva will also commit up to another $50 M on top of that to fund late stage R&D.  Thus, Teva now owns 75% of the company and has the option to purchase the final 25%.

"The investment is part of Teva's strategy to expand our branded activities into specialty therapeutic areas, such as oncology," said Dr. Aharon Schwartz, head ot Teva's Innovative Ventures.  See Fierce Biotech.

Teva marches on in diversifying its portfolio of small molecule generics, to biosimilars and now increasingly to innovator drugs, particularly in the cancer area at present.  I still maintain that within the next 5 years many companies will have similar mixed portfolios and the distinction between "innovator" and "generic or biosimilar" producer will become increasingly blurred if not mostly meaningless.

 

Posted by Bruce Lehr Sep 13th 2011.

'GSK to Buy HGS' Rumor Persists

Fierce Biotech reports that rumors are heating up (again!) that GSK will make as move to buy Human Genome Sciences (HGS) as the latter's stock price is down.  GSK, of course, partners with HGS on its recently approved Benlysta for the treatment of lupus.  With HGS stock down, analysts project that GSK coudl actually acquire the company for less than Benlysta's market value -- which would be a good deal indeed.

HGS is still chugging away at launching Benlysta -- building a commercial team to drive revenue and transform the company into a full fledged biotech -- not just a development group without a commercial product.  But as a one hit wonder, without substantial revenue flowing in at the moment, HGS is vunerable to takeover and GSK is the most likely suitor. Even rumors of the takeover haven't been sufficient to bump up HGS' stock value.  It may be only a matter of time.

 

 

Posted by Bruce Lehr Aug 25th 2011.

India Pharma Companies Stay In Play

According to The Economic Times via the Pharmalot blog, Takeda Pharmaceuticals is seekign to purchase an Indian pharma company and is considering both Cipla and Lupin.  Either company would give Takeda a beach head in the generics market in India, with Cipla as No. 2 in market and Lupin at No. 5.  According to McKinsey, the India pharma market will grow from today's $12 billion to more than $55 billion by 2020 making it one of the world's fastest growers.

Rumor has it that Lupin is asking $1.5 billion for its assets or 17 times sales.  Wow!  Good selling price if you can get extract it from the buyer. A Lupin spokesman however termed the rumor a "baseless market speculation."  Sounds like they are ready to sell any minute doesn't it?

This no doubt gives India regulators heartburn as they have already expressed concern that both Western and Japanese Big Pharma are buying up the domestic Indian companies.  The fear is that the acquirers will drive up prices on medicines for India's copious poor populations -- making many medicines unaffordable.  This is one reason that applications for compulsory licenses to Western drugs still under patent have also been rising.  This is one market dynamic to watch.

Posted by Bruce Lehr Aug 24th 2011.

BMS Strings Some More Pearls

BMS added to its holdings this week when it announced the purchase of Amira Pharmaceuticals for $325 M upfront with milestones that could total another $150 M.  The key to the deal was BMS acquisition of new drugs (namely AM152 an LPA1 antagonist) for pulmonay fibrosis. A new thearpeutic area with no approved FDA treatments.

"As part of the continued execution of our focused biopharma strategy, BMS has identified fibrotic diseases as an area of high unmet medical need that complements our research efforts in several of our therapeutic areas," said Elliott Sigal, the company's president of R&D.

Thus, BMS remains true to its "string of pearls" acquisition strategy for enhancing its portfolio and patients should benefit by the pursuit of a treatment in a novel therapeutic area -- which is good to see.  See Fierce Biotech.

Posted by Bruce Lehr July 28th 2011.