Drugmakers eye Bristol-Myers
Several of the world’s top drugmakers may weigh acquiring Bristol-Myers Squibb after it fired its chief executive, although suitors seem unlikely to bid before next year, analysts said.
While Sanofi-Aventis of France, its long-time partner on the blockbuster drug Plavix and the world’s No 3 pharmaceuticals manufacturer, is seen as the most likely buyer, others are also expected to be interested. “I think a lot of people will feel they have to look at it,” said Paul Diggle, an industry analyst at Nomura Code Securities in London.
Bristol-Myers on Tuesday forced out CEO Peter Dolan, under pressure from a federal overseer who called for Dolan’s ouster after looking into a failed deal to delay Plavix competition.
The New York-based company, which by policy does not comment on market speculation, replaced him on an interim basis with board member James Cornelius — an appointment that intrigued analysts because the former Guidant chairman helped engineer the medical device maker’s sale to Boston Scientific.
Merrill Lynch analyst David Risinger counts Sanofi, Pfizer, Merck & Co and GlaxoSmithKline Plc as potential contenders. Shaojing Tong of Mehta Partners named Glaxo, Europe’s biggest drugmaker, the “ideal candidate.”
Acquiring Bristol-Myers would jump-start Glaxo’s cardiovascular offerings by adding Plavix, which treats blood clots, and Avapro, a blood-pressure drug, while also boosting its cancer-treatment franchise, Tong said.
Such a deal would also provide huge cost-cutting opportunities for the British company as it faces generic competition over the next few years, Tong said. “The size of Bristol — you can squeeze out a lot of costs,” Tong said. Glaxo has looked at Bristol-Myers in the past but rejected the idea of a bid, according to other industry analysts.
Risinger said in a research note that Switzerland’s Novartis AG is unlikely to be in the running because of the clash between Novartis’ leukemia drug Gleevec and Bristol-Myers’ Sprycel, which would lead to antitrust problems. Novartis itself has said it has no plans for big deals.
Its head of pharmaceuticals told a broker conference on Tuesday that a big acquisition would not be advisable, since it has seven potential drug launches pending in the next two years. For Sanofi’s chairman Jean-Francois Dehecq, a veteran deal-maker, the chance may be too good to miss, said Julien Dormois, an analyst at independent European boutique investment firm Bryan Garnier.
