By Bhanvi Satija
(Reuters) -Bristol Myers Squibb said on Tuesday it would buy RayzeBio for about $4.1 billion to bolster its cancer drug business, marking the second multi-billion dollar deal struck by the drugmaker in less than a week.
Bristol Myers (NYSE:BMY) had announced a $14 billion buyout of schizophrenia drug developer Karuna Therapeutics (NASDAQ:KRTX) on Friday, nearly two months after newly-appointed CEO Chris Boerner officially took the helm at the drugmaker.
Recent deals show Bristol's urgency to bring in more products, said William Blair analyst Matt Phipps, as some of the drugmaker's older therapies are set to face a loss of patent protection later this decade.
With the RayzeBio deal, Bristol gains a late-stage targeted radiopharma therapy, RYZ101, that acts like a 'canon ball' to kill cancer cells by delivering radioactive particles to the tumorous tissue or tumor-associated cells.
Bristol also gains access to RayzeBio's manufacturing site in Indianapolis, Indiana.
Bristol will pay $62.50 for each share of RayzeBio in cash, representing a premium of 104% to the stock's last close.
RayzeBio shares, which had risen 27% since their market debut in September, more than doubled to $61.40 in early trading. Shares of Bristol were down 1.5%.
"There's still a lot of...firepower in the large pharma balance sheets and companies that have drugs that are going to lose exclusivity," said Phipps, referring to a spree of acquisitions in the biotech sector in recent weeks.
AbbVie (NYSE:ABBV) has struck two multi-billion dollar deals since November, while AstraZeneca (NASDAQ:AZN) on Tuesday said it will buy China's Gracell Biotechnologies for up to $1.2 billion.
In October, Bristol announced an up to $5.8 billion deal to buy cancer drugmaker Mirati Therapeutics (NASDAQ:MRTX), while Eli Lilly (NYSE:LLY) had said it will buy radiopharmaceutical firm Point Biopharma for $1.4 billion.