HQ Team
December 23, 2023: Bristol Myers Squibb will buy US-based biotech company, Karuna Therapeutics for $14 billion to expand its neuroscience portfolio, the companies announced.
Bristol Myers Squibb will acquire all outstanding shares of Karuna common stock for $330 a share in cash, representing about a 53% premium to Karuna Therapeutic’s closing stock price on December 21, 2023.
The transaction is expected to close in the first half of 2024. Bristol Myers Squibb expects to finance the acquisition with primarily new debt issuance.
The Boston, Massachusetts-based Karuna develops medicines for people living with psychiatric and neurological conditions.
Karuna’s main drug is KarXT (xanomeline-trospium) — an antipsychotic. The company’s New Drug Application for KarXT for the treatment of schizophrenia in adults was accepted for review by the FDA.
Treatment of psychosis
The drug is also in trials for adjunctive therapy to existing standard-of-care agents in schizophrenia and for the treatment of psychosis in patients with Alzheimer’s disease. Data from the trials are expected in 2025 and 2026.
“Bristol Myers Squibb believes KarXT represents a significant revenue contribution opportunity. Bristol Myers Squibb also sees potential from Karuna’s early-stage and pre-clinical pipeline,” according to a joint statement.
Christopher Boerner, PhD, Chief Executive Officer of Bristol Myers Squibb, said his company was eyeing a huge opportunity in the neuroscience field and aims to expand and diversify Bristol Myer’s portfolio in the space.
“This transaction fits squarely within our business development priorities of pursuing assets that are strategically aligned, scientifically sound, financially attractive, and have the potential to address areas of significant unmet medical need.
“We expect KarXT to enhance our growth through the late 2020s and into the next decade,” he said.
Alzheimer’s disease psychosis
About 1.6 million people are treated for schizophrenia in the US, a significant portion of whom do not respond to currently available therapies and experience unacceptable side effects.
KarXT is expected to launch in late 2024 in the US as a treatment for schizophrenia in adults.
A registrational clinical trial is underway evaluating KarXT as adjunctive treatment with current standard-of-care agents for the treatment of schizophrenia, with data expected in 2025.
More than 6 million people are living with Alzheimer’s disease in the US. There are currently no approved treatments for Alzheimer’s disease psychosis.
According to the statement, Bristol Myers Squibb believed KarXT also had potential in additional indications, including Bipolar I disorder, which impacts approximately 1.4 million people in the US, and Alzheimer’s disease agitation.
