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Pictured: A BMS building in California/iStock, JHVEPhoto Bristol Myers Squibb and neuroscience-focused Karuna Therapeutics announced on Friday that they have entered into a definitive merger agreement with a total equity value of $14 billion. Under the terms of the deal, BMS will buy all outstanding shares of Karuna’s common stock for $330 a pop in cash, a roughly 53.4% premium to the stock’s closing price on Thursday. The transaction, which the companies expect to close in the first half of 2024, will be worth a net of $12.7 billion in estimated cash acquired. The boards of directors of both BMS and Karuna have unanimously signed off on the deal. However, its closing will still be subject to regulatory and antitrust clearance, among other customary conditions, as well as the approval of Karuna’s stockholders. BMS CEO Christopher Boerner said in a statement that the acquisition of Karuna positions BMS to take advantage of the “tremendous opportunities in neuroscience” and “accelerates the expansion and diversification of our portfolio in the space.” At the center of the merger is Karuna’s investigational muscarinic antipsychotic KarXT (xanomeline-trospium), which is being developed for schizophrenia and psychosis in Alzheimer’s disease. Late last month, the FDA accepted the New Drug Application for Karuna in schizophrenia and is set to release its verdict in September 2024. According to Friday’s announcement, KarXT is expected to launch in the U.S. in late 2024. The therapy will enter a market of approximately 1.6 million patients undergoing treatment for schizophrenia, many of whom do not respond to currently available medications or suffer from harsh side effects. Unlike existing schizophrenia therapies, KarXT does not block dopamine receptors but instead activates both the M1 and M4 muscarinic acetylcholine receptors in the central nervous system. This mechanism of action helps improve the positive and negative symptoms of schizophrenia, as well as improve patients’ cognition. If approved, KarXT would be the first new class of schizophrenia treatment in over five decades, Karuna founder and COO Andrew Miller told BioSpace in an April 2023 interview. Beyond schizophrenia, Karuna is also developing KarXT for Alzheimer’s disease psychosis, for which it is currently running registrational clinical trials with readouts expected in 2026. For BMS, Karuna is the latest development in its dealmaking spree in recent months. Last week, the pharma signed a potential $8.4 billion contract with SystImmune, giving it the right to co-develop and co-commercialize the investigational bispecific antibody-drug conjugate BL-B01D1, which is being tested for solid tumors, outside Mainland China. A few weeks earlier, BMS expanded an existing collaboration with Avidity Biosciences, adding up to five more cardiovascular disease targets for $100 million upfront and potential cumulative payments of $2.3 billion. Tristan Manalac is an independent science writer based in Metro Manila, Philippines. He can be reached at tristan@tristanmanalac.com or tristan.manalac@biospace.com.

Bristol Myers Squibb (BMS) and SystImmune have announced an exclusive licence and collaboration agreement worth up to $8.4bn for one of SystImmune’s cancer treatments, BL-B01D1. The bi-specific topoisomerase inhibitor-based antibody-drug conjugate (ADC) targets both epidermal growth factor receptor and human epidermal growth factor receptor 3 and is currently in early-stage development to treat metastatic or unresectable non-small cell lung cancer (NSCLC). ADCs are a new class of cancer therapies designed to precisely target and kill tumour cells while sparing healthy ones. Data from earlier clinical studies of the candidate has demonstrated "promising anti-tumour activity" in patients with a range of solid tumours that had progressed after standard of care treatments, including NSCLC and breast cancer, AZ said. “Recent BL-B01D1 trials have shown broad potential across different solid tumours as well as a manageable safety profile,” said Dr Yi Zhu, chief executive officer of SystImmune, adding that the collaboration is "an exciting step forward in delivering potential anti-tumour medicines to patients worldwide”. Under the terms of the agreement, the companies will jointly develop and commercialise BL-B01D1 in the US, while SystImmune will retain exclusive rights in Mainland China and BMS will gain an exclusive licence in the rest of the world. In exchange, BMS will pay SystImmune $800m upfront and up to $500m in contingent near-term payments, with SystImmune also eligible to receive additional up to $7.1bn based on the achievement of certain development, regulatory and sales performance milestones. Samit Hirawat, executive vice president, chief medical officer, drug development at BMS, said: “SystImmune’s BL-B01D1 adds yet another ADC to our diverse pipeline and helps strengthen our approach of matching the most appropriate therapeutic modality to areas of unmet medical need across solid tumour oncology. "We look forward to working with SystImmune to advance BL-B01D1 in hopes of offering a differentiated treatment option for patients in need.” The agreement comes just over a month after BMS said it would be acquiring an experimental blood cancer therapy from Orum Therapeutics for up to $180m. The candidate, ORM-6151, is an anti-CD33 antibody-enabled GSPT1 degrader that has been given clearance from the US Food and Drug Administration for early-stage testing in patients with acute myeloid leukaemia or high-risk myelodysplastic syndromes.