TROUBLED pharmaceutical giant AstraZeneca has joined forces with Bristol-Myers Squibb on its $5.3bn (£3.37bn) acquisition of diabetes drug developer Amylin, in the British-Swedish firm’s biggest deal in five years.
Bristol-Myers Squibb announced on Saturday it will pay $31 per share for California-based Amylin – beating rival potential bidders Merck, Sanofi and Novartis to the prize – in a deal unanimously supported by the boards of both companies.
Boosting its five year old joint venture with Bristol-Myers Squibb, which focuses on drugs for type two diabetes, AstraZeneca will pay $3.4bn to Amylin after the acquisition, as well as a likely $135m more, to gain equal governance rights over the new subsidiary. Profits and losses from the diabetes specialist will be shared equally between the two drugs giants.
“This is a compelling proposition that will have an immediate positive impact on revenues and is fully in line with our stated partnering strategy to enhance top-line growth and strengthen our late-stage pipeline,” said AstraZeneca’s interim chief executive Simon Lowth. Lowth stepped up in April after David Brennan resigned due to investor unrest over AstraZeneca’s earnings prospects.
While the Amylin deal is not likely to single-handedly reverse the company’s fortunes, it could be seen by shareholders as a step in the right direction – particularly due to the shared costs – and a bid from Lowth to keep his job at the top.
Bristol-Myers Squibb was advised by Citi and Evercore, while Bank of America Merrill Lynch guided AstraZeneca through the deal. Credit Suisse and Goldman Sachs were advisers to Amylin.