Why Bristol Myers Squibb (BMY) Is Buying MyoKardia (MYOK) For $13.1 Billion

By Amit Chowdhry ● October 5, 2020
  • Bristol Myers Squibb (NYSE: BMY) and MyoKardia, Inc. (Nasdaq: MYOK) have announced a definitive merger agreement under which Bristol Myers Squibb will buy MyoKardia for $13.1 billion

Bristol Myers Squibb (NYSE: BMY) and MyoKardia, Inc. (Nasdaq: MYOK) have announced a definitive merger agreement under which Bristol Myers Squibb will buy MyoKardia for $13.1 billion ($225.00 per share) in cash. This transaction was unanimously approved by both the Bristol Myers Squibb and MyoKardia Boards of Directors and is anticipated to close during the fourth quarter of 2020.

MyoKardia is a clinical-stage biopharmaceutical company that discovers and develops targeted therapies for the treatment of serious cardiovascular diseases. And through the transaction, Bristol Myers Squibb gains mavacamten, a potential first-in-class cardiovascular medicine for the treatment of obstructive hypertrophic cardiomyopathy (HCM), a chronic heart disease with high morbidity and patient impact.

There are currently approximately 160,000 to 200,000 people diagnosed with symptomatic obstructive HCM across the U.S. and EU with no existing effective treatment options beyond limited symptomatic relief. And patients are typically diagnosed in their 40s or 50s and the treatment is expected to be chronic. It is estimated that only about 25% of individuals with obstructive HCM and only approximately 10% of individuals with non-obstructive HCM have received a diagnosis.

A New Drug Application (NDA) for mavacamten for the treatment of symptomatic obstructive HCM – based on data from the EXPLORER-HCM study – is expected to be submitted to the U.S. Food and Drug Administration (FDA) in the first quarter of 2021.

Bristol Myers Squibb expects to explore the full potential of mavacamten in additional indications, including non-obstructive HCM as well as develop MyoKardia’s promising pipeline of novel compounds, including two clinical-stage therapeutics: danicamtiv (formerly MYK-491) and MYK-224.

When the transaction is complete Bristol Myers Squibb is expecting the transaction to:

1.) Further strengthen the company’s outlook with the addition of mavacamten — which has significant commercial potential in the lead indication, obstructive HCM, and upside in additional future indications, including non-obstructive HCM.

2.) With the high unmet medical need in obstructive HCM, mavacamten could potentially be a significant medium- and long-term growth driver. And Mavacamten demonstrated clinically meaningful results in the pivotal Phase 3 EXPLORER-HCM trial, thus meeting the primary and all secondary endpoints, and showed meaningful improvements in symptoms, functional status and quality of life by reducing the obstruction of blood flow from the heart. This potential first-in-class medicine — for which an NDA is expected to be submitted to the FDA in the first quarter of 2021 — may help to change the course of the disease.

3.) Accelerate the expansion of Bristol Myers Squibb’s cardiovascular portfolio.
And Bristol Myers Squibb has established Eliquis (apixaban) as the #1 oral anticoagulant globally, driven by leading commercial execution.

Mavacamten will be a fully owned asset that fits well into Bristol Myers Squibb’s existing portfolio, given the company’s broad expertise in cardiovascular disease. And through this acquisition, Bristol Myers Squibb gains MyoKardia’s critical talent and capabilities on the U.S. West Coast — which will support fully realizing the opportunity in obstructive HCM and exploring the full potential of mavacamten in additional indications.

Bristol Myers Squibb will also be well-positioned to advance the global development of MyoKardia’s portfolio of clinical- and early-stage pipeline candidates, while continuing to advance its existing Factor XIa inhibitor program.

4.) Deliver significant financial benefits
The deal is expected to add a significant growth driver during the medium- to long-term. And it is expected to be minimally dilutive to Bristol Myers Squibb’s non-GAAP earnings per share (EPS) in 2021 and 2022 and accretive beginning in 2023. Bristol Myers Squibb reaffirms its existing 2021 non-GAAP EPS guidance range.

Terms Of The Deal

Under the terms of the deal, a subsidiary of Bristol Myers Squibb will promptly commence a tender offer to acquire all of the outstanding shares of MyoKardia’s common stock for $225 per share in cash. And MyoKardia’s Board of Directors unanimously recommends that MyoKardia shareholders tender their shares in the tender offer.

The deal is subject to customary closing conditions, including the tender of a majority of the outstanding shares of MyoKardia’s common. After the successful closing of the tender offer, Bristol Myers Squibb will acquire all remaining shares of MyoKardia that are not tendered into the tender offer through a second-step merger at the same price of $225 per share.

Bristol Myers Squibb is expecting to finance the acquisition with a combination of cash and debt.

Gordon Dyal & Co. is serving as exclusive financial advisor to Bristol Myers Squibb. And Kirkland & Ellis LLP is serving as legal counsel. Centerview Partners LLC and Guggenheim Securities are acting as joint financial advisors to MyoKardia and Goodwin Procter LLP is serving as legal counsel.

KEY QUOTES:

“The acquisition of MyoKardia further strengthens our portfolio, pipeline and scientific capabilities, and is expected to add a meaningful medium- and long-term growth driver. We are further strengthening our outstanding cardiovascular franchise through the addition of mavacamten, a promising medicine with the potential to address a significant unmet medical need in patients with cardiovascular disease. Our companies share a commitment to innovation and bold science, and our respective strengths will help us realize the value inherent in this portfolio. We have long admired MyoKardia and what they have done to revolutionize cardiovascular treatments through a precision medicine approach. We look forward to welcoming their talented team to our company.”

— Giovanni Caforio, M.D., Board Chair and Chief Executive Officer of Bristol Myers Squibb

“MyoKardia was formed eight years ago with the aim of changing the world for people with serious cardiovascular diseases through bold and innovative science. Since then, MyoKardia’s dedicated employees have established an unparalleled pipeline of targeted therapeutics designed to change the course of disease and return the heart to normal function. Bristol Myers Squibb shares our vision for transforming the treatment of cardiovascular disease. They value our team and the potential of our platform and, most importantly, share our unwavering commitment to placing patients at the center of everything we do. Together, our complementary strengths and expanded resources and reach will further accelerate the pace at which we can discover, develop and commercialize our novel medicines for the benefit of people suffering from cardiovascular disease around the world.”

— Tassos Gianakakos, Chief Executive Officer of MyoKardia