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Pharmaceutical Behemoth Bristol-Myers Squibb and Cancer’s Biotech Celgene Agree to Stock and Cash Deal

Bristol-Myers (BMY) and Celgene (CELG) have agreed to a $74 billion deal that heralds a new era in cancer research, by merging the two companies who’ve made a lot of investments in cancer immunotherapy in 2018.

  • Celgene (CELG) is trading (+32%) in the pre-market session, near $88.35/share, breaking out of its descending wedge this morning.




Bristol-Myers (BMY) Celegene (CELG) Deal

Bristol-Myers has agreed to pay Celgene shareholders one BMY share and $50 cash for each Celgene share they own. Celgene investors will also receive rights to future shares that will pay out if the combined company meets certain regulatory milestones.

“As a combined entity, we will enhance our leadership positions across our portfolio, including in cancer and immunology and inflammation,” Bristol-Myers CEO. 

Celgene was a lackluster trade in 2018, reflecting big-ticket acquisitions of Juno Therapeutics and Impact Biosciences. Celgene’s stock is off 58% from its 2017 highs. The combined companies should create some competition for its blockbuster cancer treatment, Revlimid.

Bristol-Myers also faced persistent competition from companies like Merck in cancer immunotherapy. That said, Bristol-Myers drugs, Opdivo and Yervoy, show promise in harnessing the body’s immune system to treat cancer. An aging population welcomes these advances in cancer immunotherapy R&D.

We’ll sell our remaining position in CELG this morning and reassess a potential position in BMY or MRK after the dust settles.

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