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Bristol-Myers to Acquire Amylin

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Global biopharmaceutical company Bristol-Myers Squibb (NYSE: BMY) has agreed to acquire Amylin Pharmaceuticals (NASDAQ: AMLN), which focuses on metabolic diseases, for $5.3 billion.

The two companies announced the deal, valuing Amylin at $31 per share, on Friday. According to these companies, the deal gives Bristol-Myers two diabetes drugs: Byetta and Bydureon.

Bristol-Myers CEO Lamberto Andreotti said in a statement, "Amylin's innovative diabetes portfolio, talented people and state-of-the art manufacturing facility complement our long-standing leadership in metabolics. We are pleased to be able to strengthen the portfolio we have built to help patients with diabetes by building on the success Amylin has had with its GLP-1 franchise.”

“The acquisition of Amylin by Bristol-Myers Squibb is also a unique way for Bristol-Myers Squibb and AstraZeneca to expand the alliance between the two companies, and it demonstrates Bristol-Myers Squibb's innovative and targeted approach to partnerships and business development,” continued Andreotti.

Prior to Friday's news, Amylin and AstraZeneca, another pharmaceutical company, initiated a diabetes partnership. After the Amylin acquisition is completed, AstraZeneca (NYSE: AZN) will pay Bristol-Myers $3.4 billion to support Amylin's drug portfolio development, according to Bristol-Myers.

As part of the deal, Bristol-Myers will take on Amylin's debt and buy out Amylin's former partner, Eli Lilly & Co (NYSE: LLY).

Seeking Alpha questioned the timing of Bristol-Myers' recent announcements. The article asked why Bristol-Myers increased a buyback with the stock hitting a ten year high.

In terms of acquisitions, 2012 had already been a busy year for Bristol-Myers. In January, it acquired Inhibitex (NASDAQ: INHX) for $2.5 billion. Benzinga reported that "the board of directors of Inhibitex had agreed to recommend that Inhibitex's shareholders tender their shares in the tender offer. In addition, shareholders with beneficial ownership of approximately 17 percent of Inhibitex's common stock have entered into agreements with Bristol-Myers Squibb to support the transaction and to tender their shares in the tender offer."

While analysts across the board were generally positive about the deal, the Guardian quoted Dr. Mike Mitchell at Seymour Place as saying, "[The deal] demonstrates in, our opinion, the desperation of the business in terms of pipeline-filling. We note that under the current terms of the deal, AstraZeneca will not have equal governance rights to 'key strategic and financial decisions' regarding the collaboration until it pays an additional $135m. Considering the long-standing position of AstraZeneca to look for external opportunities for product development, we are uninspired by the final terms of this deal."

Posted-In: News Financing Contracts M&A Best of Benzinga

 

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