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PRINCETON/BOSTON - Bristol Myers Squibb (NYSE:BMY), a prominent pharmaceutical company with a market capitalization of $96.7 billion and robust annual revenue of $47.6 billion, and Bain Capital announced Monday the formation of a new independent biopharmaceutical company focused on developing therapies for autoimmune diseases, backed by a $300 million financing commitment led by Bain Capital. According to InvestingPro analysis, BMY maintains a strong financial health score and currently appears undervalued based on its Fair Value assessment.
The newly established company will develop five immunology assets in-licensed from BMS, including three clinical-stage and two Phase 1-ready investigational medicines. The most advanced asset is afimetoran, an oral TLR7/8 inhibitor currently in Phase 2 clinical trials for systemic lupus erythematosus. BMY’s strong gross profit margin of 74.7% and significant dividend yield of 5.1% demonstrate its capacity to fund such strategic initiatives while maintaining shareholder returns.
BMS will retain nearly 20 percent equity in the new company and will be entitled to royalties and milestones tied to the success of each asset. Robert Plenge, Executive Vice President and Chief Research Officer at BMS, will serve on the new company’s Board of Directors.
Daniel S. Lynch, an experienced biopharmaceutical industry leader, will serve as Executive Chairman and interim CEO of the new company. The board will also include Nicholas Downing, Adam M. Koppel, and Andrew Kaplan from Bain Capital.
"We are excited to partner with BMS and we share their commitment to improving lives through science," said Adam Koppel, a Partner at Bain Capital Life Sciences, according to the press release.
The transaction aligns with BMS’s strategic shift in immunology research to focus on assets that have potential to reset the immune system and promote tissue repair.
Canada Pension Plan Investment Board has also joined the investment alongside Bain Capital, which is investing through its Life Sciences and Private Equity teams.
The new company’s pipeline includes BMS-986322, an oral TYK2 inhibitor that showed positive results in a Phase 2 trial for plaque psoriasis, and three other assets targeting the IL2, IL18, and IL10 pathways respectively.
In other recent news, Bristol Myers Squibb announced that the FDA has accepted its supplemental New Drug Application for Sotyktu, intended for the treatment of adults with active psoriatic arthritis. This decision is backed by results from Phase 3 clinical trials, which demonstrated a significant improvement in patients compared to a placebo. However, the company faced a setback as its Phase 3 INDEPENDENCE study of Reblozyl in myelofibrosis-associated anemia did not meet its primary endpoint. Despite missing statistical significance, the trial showed a numerical and clinically meaningful improvement in transfusion independence. In collaboration with Pfizer, Bristol Myers Squibb will offer a 40% discount on their anticoagulant medication Eliquis for eligible patients, starting September 8. UBS has maintained its Neutral rating on Bristol Myers Squibb, with a price target of $52.00, ahead of the company’s upcoming earnings report. The firm anticipates no major surprises in the earnings, noting potential impacts on higher-priced drugs due to Part D redesign.
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