Bristol Myers Squibb Acquires Karuna Therapeutics for $14 Billion in 2025 to Expand Neuroscience Portfolio
In a landmark $14 billion deal, Bristol Myers Squibb strengthens its neuroscience capabilities by acquiring Karuna Therapeutics, aiming to revolutionize treatments for neurological and psychiatric disorders.
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Highlights of the Acquisition
- Bristol Myers Squibb invests $14 billion to acquire Karuna Therapeutics, enhancing its neuroscience portfolio.
- The agreement offers Karuna shareholders $330 per share, reflecting a 53% premium over the previous closing price.
- Following the announcement, Karuna's stock surged to record levels, signaling strong investor confidence.
Shares of Karuna Therapeutics (KRTX) soared by more than 46% after Bristol Myers Squibb (BMY) announced its intention to purchase the biotech company for $14 billion. This strategic move is set to significantly broaden Bristol Myers Squibb’s footprint in the neuroscience sector.
Under the terms of the deal, Karuna investors will receive $330 in cash per share, a notable 53% premium compared to the day before the announcement.
Karuna Therapeutics is recognized for developing innovative treatments targeting psychological and neurological disorders. Their flagship drug, KarXT, is an antipsychotic distinguished by a novel mechanism of action, offering promising efficacy and safety profiles. The FDA is currently reviewing a new drug application for KarXT aimed at treating schizophrenia in adults.
Bristol Myers Squibb views KarXT as a substantial revenue opportunity and is also optimistic about the potential within Karuna’s early-stage and preclinical drug pipeline.
CEO Christopher Bonner emphasized that this acquisition "fortifies our position and accelerates the growth and diversification of our neuroscience portfolio." The transaction is anticipated to close in the first half of 2024.
Following the announcement, Karuna Therapeutics’ shares rose 46.9% to $316 around midday Eastern Time, while Bristol Myers Squibb’s stock increased by 2.8% to $52.68 per share.
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