Bristol Myers Squibb Enters Radiopharmaceuticals Arena with $4.1B Acquisition of RayzeBio

On December 26, Bristol-Myers Squibb (BMS) and RayzeBio announced a definitive merger agreement. Under the terms of the agreement, BMS will acquire RayzeBio for $62.50 per share in cash, representing a total equity value of approximately $4.1 billion, or about $3.6 billion net of estimated acquired cash (RayzeBio has approximately $500 million in cash on its balance sheet). The transaction is expected to close in the first half of 2024.

Through this acquisition, BMS will gain RayzeBio's differentiated radiopharmaceutical technology platform based on α-emitters and multiple innovative products under research, including RYZ101 and RYZ801, significantly enriching its oncology pipeline.

Established for 4 Years, Radiopharmaceutical Rising Star RayzeBio, Inc. Continues Its Rapid Ascent

RayzeBio, Inc. was founded in 2020 as an innovative radiopharmaceutical therapy (RPT) company at the clinical stage. In just four years, the company has not only successfully evolved into a comprehensive nuclear medicine company but also completed its IPO on Nasdaq in mid-September this year, raising a total of $311 million and ranking among the top IPOs in the global innovative drug sector in 2023.

Before its market debut, RayzeBio was highly favored by investors, securing four rounds of financing from 2020 to 2022, accumulating a total of $418 million, completely unaffected by the capital winter. Among its shareholders, Viking Global Investors (12.4%), Versant Ventures (12.2%), and venBio Partners (12.2%) each hold over 10% of the company's shares.

RayzeBio Financing History

Source: PharmaCube MedAlpha Database

After its listing, RayzeBio continued its unstoppable momentum in the secondary market, with its stock price increasing from $18 per share to $61.4 per share in just three months, marking an increase of over 240%. As of the closing on December 26, the market value of RayzeBio was $3.679 billion.

In addition, since its establishment, RayzeBio has actively carried out multi-level cooperation. While building good cooperative relationships with many clinical and research advisors, it has successively introduced peptide discovery technology platforms from PeptiDream, Bicycle, Nimble, and 48Hour Discovery to develop novel radiopharmaceuticals.

Currently, RayzeBio has developed a rich and differentiated product pipeline with competitive advantages, covering indications such as gastroenteropancreatic neuroendocrine tumors (GEP-NET), small cell lung cancer (SCLC), liver cancer, and kidney cancer.

RayzeBio Pipeline Layout

Source: RayzeBio Official Website

Among them, RYZ101 is the most advanced, currently in Phase III clinical trials for the treatment of SSTR-positive GEP-NET patients, and the ES-SCLC indication has also entered the Phase I clinical stage. RYZ101 is an RDC targeting SSTR, with a mechanism of action similar to Novartis' Lutathera. However, the radionuclide used in RYZ101 is Ac-225, an α-emitter with stronger cytotoxicity and shorter range, whereas Lutathera uses the less potent β-emitter Lu-177.

Source: RayzeBio, Inc. Official Website

RYZ801 is a first-in-class GPC3-targeted RDC drug discovered based on PeptiDream's PDPS technology platform, with the radionuclide being Ac-225. RYZ811, on the other hand, is the paired diagnostic imaging agent, using the radionuclide Ga-68. RayzeBio expects to submit clinical trial applications for these two products in the first half of 2024, intended for the treatment of liver cancer. In March this year, ABL Bio, a company in China, introduced this product. (Recommended reading: )

Another Pharmaceutical Giant Enters the Nuclear Medicine Field

Under the guidance of the concept of precision medicine, novel radiopharmaceutical therapies (RDC) will undoubtedly become the next significant wave of innovation in the field of cancer treatment due to their advantages of precise targeting, potent killing, limited damage, and integration of diagnosis and treatment.

The oncology business has always been a pillar sector for BMS. In 2022, it generated revenue of $28.875 billion through products such as Opdivo (nivolumab), Revlimid (lenalidomide), and Pomalyst/Imnovid (pomalidomide), firmly securing the top position in the oncology sector. This heavy investment by BMS in acquiring RayzeBio represents a further deepening of its oncology business layout.

BMS CEO Dr. Christopher Boerner also stated in the press release that the new radiopharmaceutical therapy will bring new opportunities for the company's future performance growth.

2022 Revenue from Oncology Businesses of Pharmaceutical Giants

Note: 1. The total revenue of the oncology business is in billions of US dollars; Roche's single product revenue has not been converted by exchange rate, and the unit is still in billions of Swiss francs. 2. Oncology performance is only counted based on financial reports. If there are any omissions or errors, corrections and supplements are welcome.

However, long before Bristol-Myers Squibb ventured into nuclear medicine, multinational corporations (MNCs) such as Novartis, Bayer, Eli Lilly, and Johnson & Johnson had already heavily invested in this field. Among them, Bayer and Novartis are undisputed leaders in the RDC (Radiopharmaceutical Drug Conjugates) sector. The former rapidly built a radioligand therapy technology platform through acquisitions and holds two blockbuster products, Lutathera and Pluvicto. The latter launched Xofigo a decade ago and subsequently made significant investments by acquiring Algeta, Noria, and PSMA Therapeutics to further strengthen its position in RDC.

Lilly recently fired the first shot in targeted radiopharmaceuticals with a $1.4 billion acquisition. On October 3, the company announced the acquisition of POINT Biopharma at $12.50 per share, a 68% premium, gaining several RDCs, including two late-stage clinical products, PNT2002 and PNT2031, POINT’s next-generation radioligand therapy technology platform, and the corresponding radiopharmaceutical supply chain.

In addition, AstraZeneca, Merck, Johnson & Johnson and other MNCs have also entered the nuclear medicine field through equity investment, technology introduction and other methods. (Recommended reading:)

BMS's acquisition this time undoubtedly further increased the heat of nuclear medicine, also indicating that there might be more MNCs entering the market in the future. Whether nuclear medicine will become a battleground for pharmaceutical companies like ADC, let us wait and see.

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