Bristol Myers Squibb and Karuna Therapeutics announced that they have entered into a definitive merger agreement under which Bristol Myers Squibb has agreed to acquire Karuna for $330.00 per share in cash, for a total equity value of $14.0 billion, or $12.7 billion net of estimated cash acquired. The transaction was unanimously approved by both the Bristol Myers Squibb and Karuna Boards of Directors.

Karuna is a biopharmaceutical company driven to discover, develop and deliver transformative medicines for people living with psychiatric and neurological conditions.

Karuna’s lead asset, KarXT (xanomeline-trospium), is an antipsychotic with a novel mechanism of action (MoA) and differentiated efficacy and safety. Karuna’s New Drug Application (NDA) for KarXT for the treatment of schizophrenia in adults was accepted for review by the U.S. Food and Drug Administration (FDA), with a Prescription Drug User Fee Act (PDUFA) date of September 26, 2024.

“There are tremendous opportunities in neuroscience, and Karuna strengthens our position and accelerates the expansion and diversification of our portfolio in the space. We expect KarXT to enhance our growth through the late 2020s and into the next decade,” said Christopher Boerner, Ph.D., Chief Executive Officer of Bristol Myers Squibb. “This transaction fits squarely within our business development priorities of pursuing assets that are strategically aligned, scientifically sound, financially attractive, and have the potential to address areas of significant unmet medical need. We look forward to welcoming the talented Karuna team to Bristol Myers Squibb.”

“Schizophrenia and Alzheimer’s disease psychosis affect millions of people worldwide, with limited to no treatment options. KarXT’s novel mechanism has resulted in a transformational profile in schizophrenia, with compelling efficacy and a differentiated safety profile,” said Samit Hirawat, M.D., Executive Vice President, Chief Medical Officer, Drug Development of Bristol Myers Squibb. “KarXT also has the potential to deliver meaningful benefits to patients as an adjunctive treatment for patients with schizophrenia and as a first treatment for Alzheimer’s disease psychosis.”

Bill Meury, President and Chief Executive Officer of Karuna Therapeutics, said, “Karuna’s portfolio offers advancements in treatment not seen in many years. With Bristol Myers Squibb’s long-standing expertise in developing and commercializing medicines on a global scale and legacy in neuroscience, KarXT and the other assets in our pipeline will be well-positioned to reach those living with schizophrenia and Alzheimer’s disease psychosis. This announcement is a testament to the Karuna team’s talent, hard work, and innovation.”

The transaction is expected to close in the first half of 2024, subject to customary closing conditions, including approval of Karuna stockholders and receipt of required regulatory approvals.