FTC focuses on psoriasis franchise for Bristol-Celgene deal review
(Reuters) – The U.S. Federal Trade Commission has sought additional information from Bristol-Myers Squibb Co and Celgene Corp and is focusing on the companies’ psoriasis treatments as part of its review of their planned merger, Bristol-Myers said on Tuesday.
“The parties understand that the FTC’s review is focused on marketed and pipeline products for the treatment of psoriasis,” Bristol-Myers said in a filing.
Celgene’s psoriasis drug Otezla brought $448 million in sales in the quarter ended Dec. 31. Bristol-Myers is also developing a treatment for the condition and in September reported positive results from a mid-stage trial of its plaque psoriasis drug.
“Given the diverse range of assets from across biopharma that are either already on the market, or in development to treat psoriasis, we would be surprised if the overlap between Bristol and Celgene’s portfolios is too much for the FTC to get comfortable with,” Credit Suisse analyst Vamil Divan said in a note.
However, the FTC review is not the only challenge the companies face.
Some Bristol-Myers investors are against the planned $74 billion takeover of Celgene, as they see potential risk associated with Celgene’s pipeline, and expect a drop in sales of its flagship multiple myeloma drug, Revlimid, when it loses U.S. exclusivity in 2022.
However, the cancer drugmaker maintains that the Celgene acquisition would provide “significant advantages” with fewer risks compared to options like pursuing a series of small transactions.
Bristol-Myers said both companies expect to close the merger in the third quarter of 2019.
Shares of Bristol-Myers were up $1.8 percent at $48.33 and Celgene rose 1.6 percent to $89.36.
Reporting by Tamara Mathias in Bengaluru; Editing by Shinjini Ganguli
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