Bristol-Myers Squibb Announces Agreement Between Celgene and Amgen to Divest OTEZLA® for $13.4 Billion
- Category: More News
- Published on Tuesday, 27 August 2019 11:22
- Hits: 632
Agreement Contingent on FTC Consent Decree and Closing of Pending Bristol-Myers Squibb-Celgene Merger
Pending Bristol-Myers Squibb-Celgene Merger Expected to Close by End of 2019
NEW YORK, NY, USA I August 26, 2019 I Bristol-Myers Squibb Company (NYSE: BMY) announced today that Celgene Corporation (NASDAQ: CELG), in connection with its merger agreement with Bristol-Myers Squibb, has entered into an agreement with Amgen (NASDAQ: AMGN) under which Amgen would acquire the global rights to OTEZLA® (apremilast) for $13.4 billion in cash. Bristol-Myers Squibb previously announced the decision to divest OTEZLA in connection with the ongoing regulatory approval process for the Company’s pending merger with Celgene. The closing of the acquisition covered by the agreement with Amgen is contingent on Bristol-Myers Squibb and Celgene entering into a consent decree with the Federal Trade Commission (FTC) in connection with their pending merger, the closing of the pending merger, and the satisfaction of other customary closing conditions.
“This agreement represents an important step toward completing our pending merger with Celgene. It also demonstrates the tremendous achievement of the Celgene team in establishing OTEZLA as an important medicine for patients with psoriasis, psoriatic arthritis and Behçet’s Disease,” said Giovanni Caforio, M.D., Chairman and Chief Executive Officer of Bristol-Myers Squibb. “Together with the OTEZLA team, Amgen has the capabilities and infrastructure to continue to support this important medicine and ensure a seamless transition for patients and healthcare providers.”
Bristol-Myers Squibb now expects the pending merger with Celgene to close by the end of 2019.
Under the terms of the agreement and subject to the closing conditions, Amgen will acquire OTEZLA and related intellectual property, including any patents that primarily cover apremilast, as well as other assets and liabilities related to OTEZLA. The agreement includes the transfer of Celgene employees primarily dedicated to OTEZLA.
Use of Proceeds and Capital Allocation
Bristol-Myers Squibb plans to prioritize the use of proceeds from the OTEZLA divestiture for debt reduction.
In the context of its overall approach to capital allocation, Bristol-Myers Squibb plans to focus on de-leveraging in the near term to maintain strong investment grade credit ratings and less than 1.5x debt/EBITDA by 2023. Beyond that, Bristol-Myers Squibb’s strategic approach to capital allocation remains unchanged with future business development and sourcing external innovation a priority, while continuing to plan for annual dividend increases and disciplined employment of share repurchases.
Today Bristol-Myers Squibb also announced that it is increasing its previously planned $5 billion accelerated share repurchase to $7 billion. The share repurchase will be executed following closing of the pending Bristol-Myers Squibb merger with Celgene, subject to Board approval. The additional authorization is based on strong business trends across both Bristol-Myers Squibb and Celgene, encouraging clinical developments across the pipeline of both companies and increased visibility into the closing of the pending merger with Celgene.
Morgan Stanley & Co. LLC is serving as financial advisor to Bristol-Myers Squibb, and Kirkland & Ellis LLP is serving as Bristol-Myers Squibb’s legal counsel regarding the divestiture. Arnold & Porter Kaye Scholer LLP is also acting as legal counsel on antitrust matters.
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.
SOURCE: Bristol-Myers Squibb