Bristol Myers Squibb Acquires Karuna Therapeutics for $14 Billion to Boost Neurological Drugs Market

Summary

  • Bristol Myers Squibb (NYSE:) set to acquire neuroscience-drug developer Karuna Therapeutics (NASDAQ:) for $14 billion.
  • Agreement details Bristol Myers Squibb paying $330 per share in cash, including Karuna’s current $1.3 billion cash holding.
  • The acquisition impacts Bristol Myers Squibb’s share value whilst providing a 50% premium on Karuna shares.
  • This strategic acquisition is scheduled for completion in H1 of next year, and will bolster Bristol Myers Squibb’s hold on the psychiatric and neurological drugs market.
  • Karuna’s portfolio highlight, KarXT, is an experimental drug under FDA review for schizophrenia treatment.

Pharmaceutical giant Bristol Myers Squibb (NYSE:) will acquire neuroscience-drug developer, Karuna Therapeutics (NASDAQ:), in a deal worth $14 billion, according to recent news reports.

As per the specifics of the agreement, Bristol Myers Squibb will purchase Karuna’s shares at $330 each in cash. This sum also encompasses the $1.3 billion cash currently held by Karuna, reports Wall Street Journal.

Bristol Myers Squibb Share Impact

Following this news, Bristol Myers Squibb’s shares took a dip of 2.2% in pre-market activity. Previous close on Karuna shares stood at $215.19, rendering the acquisition a substantial premium of over 50%.

Strategic Acquisition

The acquisition, slated for closure in the first half of the forthcoming year, personifies a key strategy for Bristol Myers Squibb to solidify its foothold in the psychiatric and neurological drugs market.

Karuna’s Key Drug

A critical asset for Karuna is their experimental drug, KarXT. This drug is currently undergoing a review process with the Food and Drug Administration (FDA) for approval as a treatment for schizophrenia.

The potential alterations in share value brought on by this acquisition can substantially impact Forex trading, particularly for assets linked to Bristol Myers Squibb and Karuna Therapeutics.

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