Shares of biopharmaceutical major Bristol-Myers Squibb (NYSE:BMY) are ticking higher today after the company announced a global strategic collaboration with SystImmune in a deal worth nearly $8.4 billion. SystImmune is a clinical-stage biopharmaceutical company.
The two companies will co-develop and co-commercialize BL-B01D1, a drug that will be used for the treatment of lung and breast cancer. While SystImmune will retain exclusive rights in Mainland China, BMY will have an exclusive license for BL-B01D1 for the rest of the world.
This strategic collaboration is expected to further diversify BMY’s oncology portfolio while bolstering its presence in ADCs (Antibody Drug Conjugates). BL-B01D1 is currently being evaluated in a global Phase 1 study for metastatic or unresectable non-small cell lung cancer (NSCLC). In previous studies, the drug has demonstrated promising anti-tumor activity.
Under the deal, SystImmune will receive $800 million in an upfront payment and up to $500 million in contingent payments from BMY. It also stands to receive up to $7.1 billion in certain milestone payments. The deal remains subject to approval from antitrust authorities.
The collaboration with SystImmune comes on the heels of BMY’s recently expanded global licensing and research collaboration deal with Avidity Biosciences (NASDAQ:RNA), which is worth $2.3 billion. BMY also expanded its share repurchase program to $5 billion and increased its dividend by 5.3% last week.
What is the Future of BMY Stock?
Despite the recent price uptick, BMY shares remain nearly 35% lower over the past year. Overall, the Street has a Moderate Buy consensus rating on Bristol-Myers Squibb, and the average BMY price target of $61.82 implies a 21% potential upside in the stock.
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