Bristol-Myers Squibb Co. CEO Giovanni Caforio dismissed speculation that the pharmaceutical giant could become an acquisition target amid a merger with Celgene Corp., telling investors that the deal was not a defensive move to avoid a takeover.
Caforio said at a March 12 investors conference that no offer to buy Bristol-Myers has been made, although he did acknowledge that he has spoken with other pharmaceutical leaders informally about deals "at a very high level" in the past. The executive said those discussions have not happened since 2017, however, and have never advanced beyond informal talks.
"There has been no discussion about economic terms," Caforio said at the Cowen Health Care Conference March 12. "There has been no offer."
Bristol-Myers Squibb Co. CEO Giovanni Caforio
Source: Bristol-Myers Squibb
New York's Bristol-Myers remains poised to acquire Celgene for an estimated $95 billion, a deal that is expected to close in the third quarter of the year pending a positive April 12 shareholder vote. Two shareholders have publicly denounced the merger, but analysts have said the deal is still likely to go through. The company's board has appealed to shareholders to support the deal, calling it the best path forward for both companies.
Caforio defended his company's motives for the acquisition at the Cowen conference, saying that Celgene was not approached to avoid a takeover.
"This is not a defensive deal," Caforio said. "We didn't do it because there was an offer on the table."
He cited instead a pipeline of assets, which he said came at "a very attractive price."
"This is the right option and the best option for Bristol-Myers Squibb," Caforio said. "It creates ... a stronger company that is better positioned for long-term and sustainable growth."
Some analysts and investors have criticized the deal because sales of Celgene's top seller, cancer drug Revlimid, are threatened by the expected entry of a generic version by 2022.
But Bristol-Myers CFO Charles Bancroft said at the Cowen conference that the company has done its due diligence, examining every possible roadblock going forward.
"We looked at a range of different scenarios, and in any of those scenarios, we add shareholder value overall," Bancroft said.