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ACQUISITIONS, DIVESTITURES, LICENSING AND OTHER ARRANGEMENTS | 3 Months Ended
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Mar. 31, 2025
Acquisitions, Divestitures and Other Arrangements [Abstract] |
ACQUISITIONS, DIVESTITURES, LICENSING AND OTHER ARRANGEMENTS | ACQUISITIONS, DIVESTITURES, LICENSING AND OTHER ARRANGEMENTS Asset Acquisition Karuna On March 18, 2024, BMS acquired Karuna, a clinical-stage biopharmaceutical company driven to discover, develop, and deliver transformative medicines for people living with psychiatric and neurological conditions. The acquisition provided BMS with rights to Cobenfy (xanomeline and trospium chloride), formerly KarXT. Cobenfy is an antipsychotic with a novel mechanism of action and differentiated efficacy and safety, which was approved by the FDA on September 26, 2024 for the treatment of schizophrenia in adults. Cobenfy is being studied across multiple neuropsychiatric conditions. BMS acquired all of the issued and outstanding shares of Karuna's common stock for $330.00 per share in an all-cash transaction for total consideration of $14.0 billion, or $12.9 billion net of cash acquired. The acquisition was funded primarily with debt proceeds (see "—Note 10. Financing Arrangements" for further detail). The transaction was accounted for as an asset acquisition since Cobenfy represented substantially all of the fair value of the gross assets acquired. As a result, $12.1 billion was expensed to Acquired IPRD during the three months ended March 31, 2024. Total consideration also included $1.1 billion of vested equity awards and $289 million of unvested equity awards that were paid during the second quarter of 2024. The following summarizes the total consideration transferred and allocated:
Dollars in millions |
Cash consideration for outstanding shares | $ | 12,606 |
Cash consideration for equity awards | 1,421 |
Consideration paid | 14,027 |
Less: Charge for unvested stock awards(a) | (289) |
Transaction costs | 55 |
Total consideration allocated | $ | 13,793 |
(a) Includes cash-settled unvested equity awards of $130 million expensed in Selling, general and administrative and $159 million expensed in Research and development during the three months ended March 31, 2024. Business Combinations RayzeBio On February 26, 2024, BMS acquired RayzeBio, a clinical-stage RPT company with actinium-based RPTs for solid tumors. The acquisition provided BMS with rights to RayzeBio’s actinium-based radiopharmaceutical platform and lead asset, RYZ101, which is in Phase III development for treatment of gastroenteropancreatic neuroendocrine tumors. BMS acquired all of the issued and outstanding shares of RayzeBio's common stock for $62.50 per share in an all-cash transaction for total consideration of $4.1 billion, or $3.6 billion net of cash acquired. The acquisition was funded through a combination of cash on hand and debt proceeds (see "—Note 10. Financing Arrangements" for further detail). Total consideration for the acquisition consisted of the following:
Dollars in millions |
Cash consideration for outstanding shares | $ | 3,851 |
Cash consideration for equity awards | 296 |
Consideration paid | 4,147 |
Less: Unvested stock awards(a) | (274) |
Total consideration allocated | $ | 3,873 |
(a) Includes cash settlement for unvested equity awards of $159 million expensed in Selling, general and administrative and $115 million expensed in Research and development during the three months ended March 31, 2024. The transaction was accounted for as a business combination requiring all assets acquired and liabilities assumed to be recognized at fair value as of the acquisition date. The majority of the purchase price was allocated to indefinite-lived IPRD and R&D technology. Mirati On January 23, 2024, BMS acquired Mirati, a commercial stage targeted oncology company, obtaining the rights to commercialize lung cancer medicine Krazati, and to further develop several clinical assets, including a PRMT5 Inhibitor. Krazati, a KRAS G12C inhibitor, is FDA and EMA approved for second-line NSCLC and in clinical development with a PD-1 inhibitor for first-line NSCLC. It is also FDA approved for advanced or metastatic KRAS G12C mutated colorectal cancer with cetuximab. In addition, the PRMT5 Inhibitor is a potential first-in-class MTA-cooperative PRMT5 inhibitor, which is advancing to the next stage of development. BMS acquired all of the issued and outstanding shares of Mirati's common stock for $58.00 per share in an all-cash transaction for total consideration of $4.8 billion, or $4.1 billion net of cash acquired. Mirati stockholders also received one non-tradeable CVR for each share of Mirati common stock held, potentially worth $12.00 per share in cash for a total value of approximately $1.0 billion. The payout of the CVR is subject to the FDA acceptance of an NDA for PRMT5 Inhibitor for the treatment of specific indications within seven years of the closing of the transaction. The acquisition was funded through a combination of cash on hand and debt proceeds (see "—Note 10. Financing Arrangements" for further detail). Total consideration for the acquisition consisted of the following:
Dollars in millions |
Cash consideration for outstanding shares | $ | 4,596 |
Cash consideration for equity awards | 205 |
Consideration paid | 4,801 |
Plus: Fair value of CVRs | 248 |
Less: unvested stock awards(a) | (114) |
Total consideration allocated | $ | 4,935 |
(a) Includes cash settlement of unvested equity awards of $60 million expensed in Selling, general and administrative and $54 million expensed in Research and development during three months ended March 31, 2024. The transaction was accounted for as a business combination requiring all assets acquired and liabilities assumed to be recognized at fair value as of the acquisition date. The majority of the purchase price was allocated to a definite-lived Acquired marketed product right (Krazati) and indefinite-lived IPRD assets. The results of operations and cash flows for Karuna, RayzeBio and Mirati were included in the consolidated financial statements commencing on their respective acquisition dates and were not material. Historical financial results of the acquired entities were not significant. Divestitures The following table summarizes the financial impact of divestitures including royalties, which is included in Other (income)/expense, net. Revenue and pretax earnings related to all divestitures were not material in all periods presented (excluding divestiture gains or losses).
| Three Months Ended March 31,
| Net Proceeds |  | Divestiture (Gains)/Losses |  | Royalty Income
Dollars in millions | 2025 |  | 2024 |  | 2025 |  | 2024 |  | 2025 |  | 2024
Diabetes business - royalties | $ | 276 |  |  | $ | 231 |  |  | $ | — |  |  | $ | — |  |  | $ | (272) |  |  | $ | (271) |
Mature products and other | 10 |  |  | — |  |  | (9) |  |  | — |  |  | — |  |  | — |
Total | $ | 286 |  |  | $ | 231 |  |  | $ | (9) |  |  | $ | — |  |  | $ | (272) |  |  | $ | (271) |
Diabetes Business As part of the BMS diabetes termination agreement with AstraZeneca, BMS receives royalty payments of 14% in 2025 and 15% in 2024 based on net sales. Payments will be received on sales through December 31, 2025. Licensing and Other Arrangements The following table summarizes the financial impact of Keytruda* royalties, Tecentriq* royalties, upfront licensing fees and milestones for products that have not obtained commercial approval, which are included in Other (income)/expense, net.
| Three Months Ended March 31, |  |
Dollars in millions | 2025 |  | 2024 |  |  |  |
Keytruda* royalties | $ | (151) |  |  | $ | (133) |  |  |  |  |
Tecentriq* royalties | (12) |  |  | (12) |  |  |  |  |
Contingent milestone income | (40) |  |  | — |  |  |  |  |
Amortization of deferred income | (12) |  |  | (12) |  |  |  |  |
Other royalties and licensing income | (43) |  |  | (4) |  |  |  |  |
Royalty and licensing income | $ | (259) |  |  | $ | (161) |  |  |  |  |
Keytruda* Patent License Agreement BMS and Ono are parties to a global patent license agreement with Merck related to Merck's PD-1 antibody Keytruda*. Under the agreement, Merck paid ongoing royalties on global sales of Keytruda* of 6.5% through December 31, 2023 and is obligated to pay 2.5% from January 1, 2024 through December 31, 2026. The companies also granted certain rights to each other under their respective patent portfolios pertaining to PD-1. Payments and royalties are shared between BMS and Ono on a 75/25 percent allocation, respectively, after adjusting for each party's legal fees. Tecentriq* Patent License Agreement BMS and Ono are parties to a global patent license agreement with Roche related to Tecentriq*, Roche’s anti-PD-L1 antibody. Under the agreement, Roche is obligated to pay single-digit royalties on worldwide net sales of Tecentriq* through December 31, 2026. The royalties are shared between BMS and Ono consistent with existing agreements. In-license and other arrangements 2seventy bio On March 10, 2025, BMS entered into a definitive merger agreement to acquire 2seventy bio, which will provide BMS with full U.S. rights to Abecma, a cell therapy for the treatment of adult patients with relapsed or refractory multiple myeloma. Upon closing, BMS will acquire all of the issued and outstanding shares of 2seventy bio’s common stock for $5.00 per share in an all-cash transaction for total consideration of approximately $286 million, or $100 million net of estimated cash acquired. The transaction is expected to close in the second quarter of 2025 subject to customary closing conditions. BioArctic In February 2025, BMS obtained a global exclusive license from BioArctic for its PyroGlutamate-amyloid-beta antibody program, including BAN1503 and BAN2803, of which the latter includes BioArctic’s BrainTransporter TM technology and is being studied for the treatment of Alzheimer's Disease. BMS is responsible for development and commercialization worldwide, including strategic decisions, regulatory responsibilities, funding and manufacturing. BioArctic has the option to co-commercialize in Denmark, Finland, Iceland, Norway, and Sweden. The transaction included an upfront payment of $100 million, which was included in Acquired IPRD for the three months ended March 31, 2025. BioArctic is eligible to receive contingent development, regulatory and sales-based milestones of up to $1.3 billion, as well as royalties on global net sales.

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- Definition Acquisitions, Divestitures and Other Arrangements [Abstract] + References No definition available. + Details
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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/205-20/tableOfContent + Details
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