Bristol-Myers Squibb Co.
Photographer: Daniel Acker / Bloomberg
Photographer: Daniel Acker / Bloomberg
Investors in a deal sweetener who when Bristol-Myers Squibb Co. acquired Celgene Corp. in 2019 and their all-or-nothing bet was wiped out as U.S. regulators failed to approve a drug on time.
The conditional value law, or CVR, depended on three drug candidates being approved. In a Statement early on Friday, Bristol-Myers said the second major deadline – approval for lymphoma cell liso-cell therapy – expired on Dec. 31 without a decision from the Food and Drug Administration. The final hurdle of the CVR would have been the March 31 approval for another new therapy called ide cell.
The $ 9 per share sweetener traded to $ 4.76 each in April, before falling to 49 cents during Thursday’s extended trading. There are nearly 715 million CVRs open, which would have translated into a total payout of $ 6.4 billion if all the conditions were met, according to data compiled by Bloomberg. The CVRs are no longer traded on the New York Stock Exchange.
Bristol-Myers said it continues to work closely with the FDA to support the review of its biologic license application for liso cell and continues to bring the therapy to patients.
In a Dec. 23 note, Mizuho analyst Salim Syed highlighted how rare it is for the FDA to approve drugs between Christmas and New Year’s Day. He estimated the process value of the CVR at 30 cents to $ 1.40.
– With help from James Ludden