MyoKardia to attain $225 per share, a premium of 61% over the biotech stock’s Friday closing price.
The biotech company, MyoKardia Inc. (MYKO) is set to be bought by the drug giant Bristol Myers Squibb Co. for approximately $13.1 billion in cash. Bristol-Myers have made this deal for expanding its offering of heart therapies.
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Bristol Myers will be making this acquisition after the company pulled off the largest pharmaceutical deal in history just a year ago. A deal which was worth $74 billion, the company acquired the multiple-myeloma drug leader Celgene Corp.
According to a statement, MyoKardia will receive $225 a share, a premium of 61% over the biotech stock’s Friday closing price of $139.60.
The stock price made a massive move followed by acquisition news and so far, MYOK has surged above 50% in the market today. As of 01:30 P.M. EDT, the stock was trading at $220.29 up by almost 57%. MYOK’s previous close on Friday was $139.60 before the stock kicked off today’s trading session at $220.68.
MyoKardia’s specialty in providing therapy for cardiovascular diseases has attracted Bristol Myers to acquire the firm enhancing its product line for providing treatment against heart diseases. Bristol Myers considers MyoKardia to be a multi-billion-dollar asset for the company in the future.
The CEO of Bristol Myer, Giovanni Caforio stated:
“We’ve been thinking about other ways we can strengthen the company, and in particular, the other side of the decade. This is a disease with no available treatment, and the value is very significant.”
The acquisition of MyoKardia further strengthens Bristol Myers’ portfolio, pipeline and scientific capabilities, and will add a meaningful medium- and long-term growth driver for the company.
Recently, MyoKardia developed a pipeline of therapies for heart diseases and obtained all the primary and secondary endpoints for its experimental drug mavacamten during Phase 3 obstructive hypertrophic cardiomyopathy testing. Moreover, it is anticipated that mavacamten will be submitted to the FDA for approval in the first quarter of 2021.
The following deal between both the companies is expected to be completed by the end of the fourth quarter of 2020, with the boards of both firms already approving this deal.
The buying company plans to fund the deal with both cash and debt. The acquisition of MyoKardia Inc, (MYOK) would be accretive to Bristol Myers’ non-GAAP earnings by the start of 2023, with the company working on the commercialization of mavacamten by that time.
The acquisition will add to Bristol’s debt but will diversify its portfolio and will benefit in the longer run. Caforio said that this is not an acquisition that will put significant strain on their R&D spend.
