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Bristol-Myers bets on 'multibillion-dollar potential' with $13.1B MyoKardia deal

Bristol-Myers Squibb Co.'s pending $13.1 billion deal to buy cardiovascular drugmaker MyoKardia Inc. brings in a treatment candidate with "multibillion-dollar potential," Bristol-Myers CEO Giovanni Caforio said.

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Bristol-Myers Squibb CEO Giovanni Caforio
Source: Bristol-Myers Squibb

The deal is the fourth-largest acquisition announced in 2020. Bristol-Myers executed the largest M&A deal of 2019 with its purchase of Celgene, whose top-selling drug Revlimid faces potential competition in the near future.

"Externally, we've been looking at opportunities like MyoKardia that fit into a therapeutic area that we know well, where we have strong expertise and capabilities, assets that are transformational from a science perspective and transactions that make sense financially," Caforio said on an Oct. 5 M&A call with investors. "So this one fits all of those."

MyoKardia's mavacamten inhibits the production of myosin, a protein that thickens heart muscle, causing a condition called hypertrophic cardiomyopathy, a disease that puts patients at risk of cardiac events. A late-stage study of mavacamten showed the drug benefited patients, and both companies expect to file for U.S. approval in the first quarter of 2021 with breakthrough status.

Bristol-Myers is already a major player in the cardiovascular space with blockbuster blood thinner Eliquis, co-owned with Pfizer Inc., which had $4.8 billion in sales in the first half of 2020.

"We wanted to work with the MyoKardia team to be able to bring all of our expertise to the regulatory process and most importantly to the commercial launch," Caforio said. "This is not just the right asset — it's also the right time."

MyoKardia's stock rose 57.88% to $220.40 per share as of 1:15 p.m. ET on Oct. 5.

Targeting the heart

MyoKardia's approach to treating a condition like hypertrophic cardiomyopathy, which is hereditary, is by targeting the genes that code for the disease-causing protein. MyoKardia CEO Tassos Gianakakos said in an interview at the J.P. Morgan Healthcare Conference in January that precision medicine is finally making its way to the cardiovascular space.

"Cardiovascular disease has not had any meaningful innovation, broadly speaking, in a long time — tens of millions of patients are still being treated with beta blockers, for instance," Gianakakos told S&P Global Market Intelligence at the time.

Part of targeting genetic diseases in the heart is finding the right diagnostic tools, Gianakakos said, and MyoKardia has looked to new technology to take earlier preventive steps.

"Digital diagnosis technologies are part of the plan to make diagnosis of HCM more timely, ultimately increasing the number of patients eligible for treatment with mavacamten," Gianakakos said. "We think the diagnosis rate will double or triple just based on what we're doing, let alone introducing technology for that."

In terms of tying up with a large pharmaceutical company like Bristol-Myers, Gianakakos said in January that the step was not yet a clear direction for MyoKardia.

"The canonical Big Pharma, Big Biotech-type of relationship isn't obvious for us — it would have to bring a real motivated global reach, and we need to be sure there is the commitment there," Gianakakos said. "We can't just be one more asset in a portfolio; we've got to be a therapy that needs to get to patients."