AstraZeneca is evaluating a possible purchase of Bristol Myers Squibb, according to media reports, though neither company has offered public comment on the speculation.
Analysts at Barclays said they do not believe a deal is likely in the immediate future. Their assessment recognizes that Bristol Myers’ portfolio of established cash-flow drugs could fit well with an acquirer seeking near-term revenue, but Barclays cautioned that such benefits would be tempered by forthcoming loss of exclusivity events for some of Bristol Myers’ top products.
Bristol Myers recently raised its guidance for its anticoagulant Eliquis for fiscal year 2026. Market consensus expects the company’s oncology immunotherapy Opdivo to deliver more than $10 billion in revenue this year and next. Both Eliquis and Opdivo are slated to face U.S. generic or biosimilar competition in 2028, which Barclays highlights as a key constraint on long-term upside from those assets.
The company has also revised development timetables for multiple clinical programs. Timelines were extended for LIBREXIA-AF, the milvexian program in atrial fibrillation, and for the ADEPT trials evaluating Cobenfy in Alzheimer’s disease psychosis.
Barclays’ current net present value model assigns a $77.70 per-share base valuation and incorporates probabilistic outcomes for key pipeline assets. The firm assigns a 60% probability of success for milvexian across atrial fibrillation and secondary stroke prevention, with peak sales potential of $11.5 billion across those indications. For Cobenfy in Alzheimer’s disease psychosis, Barclays assigns a 54% success probability and $4.3 billion peak sales potential. Admilparant in idiopathic pulmonary fibrosis is given a 50% chance of success and $3.1 billion in peak sales potential.
Under Barclays’ scenario in which all pipeline programs succeed, the valuation would rise to $88.20 per share - about 35% above the prior trading day’s close. Conversely, a scenario in which all programs fail would reduce the valuation to $63.10 per share, roughly 3% below that same closing price.
Summary
AstraZeneca has reportedly been exploring an acquisition of Bristol Myers Squibb. Barclays does not see a near-term deal and notes that while Bristol Myers’ revenue-generating drugs offer strategic value, upcoming patent expirations and delayed trial timelines limit the potential synergies and valuation upside. Barclays provides a range of per-share valuations tied to pipeline outcomes.
Key points
- Bristol Myers’ core marketed drugs - including Eliquis and Opdivo - are significant cash-flow drivers but face U.S. generic or biosimilar competition in 2028, which will affect long-term revenue prospects.
- Barclays does not view an AstraZeneca-Bristol Myers deal as imminent and quantifies pipeline risk and upside in a probabilistic valuation model.
- Delays in clinical program timelines - such as for milvexian (LIBREXIA-AF) and Cobenfy (ADEPT) - are factored into Barclays’ current valuation assumptions.
Risks and uncertainties
- Loss of exclusivity - Key marketed products are scheduled to face U.S. generic or biosimilar competition in 2028, which could materially reduce sales and affect acquisition benefits - this risk is relevant to pharmaceutical and healthcare market participants.
- Clinical development delays - Pushouts of milvexian and ADEPT trial timelines add uncertainty to the timing and likelihood of future revenue from pipeline assets, impacting biotech valuations and investment decisions.
- Pipeline binary outcomes - Barclays’ valuation swings significantly depending on whether pipeline programs succeed or fail, underscoring program-specific technical and regulatory risk for investors and acquirers.
Tags: Pharmaceuticals, M&A, Valuation, Biotech