Is a Bayer 'merger of equals' in the stars?

Bayer CEO Marijn Dekkers (photo) isn't desperate to make a match. But if the right company came along? Well, he might just do a deal. In an interview with Bloomberg, Dekkers said he'd like to bolster Bayer's $25.1 billion healthcare unit with a "merger of equals"--but only "if the stars were to be aligned."

Dekkers wouldn't say which "equals" in the pharma business might catch his fancy. But Bloomberg named three possibilities based on company size. Pharma companies with similar annual sales to Bayer's healthcare unit include Eli Lilly and Bristol-Myers Squibb, the news service points out, while Amgen posted $15.1 billion in revenues last year.

The chief executives at Lilly and Bristol-Myers have been pursuing their solo strategies as several Big Pharma rivals embarked on their own big mergers. In fact, Lilly CEO John Lechleiter (photo) has panned the idea of a Lilly mega-merger so many times, we're sure he could do so in his sleep. BMS chief Lamberto Andreotti (photo) appears perfectly happy to continue his predecessor's string-of-pearls, small-deal approach. But perhaps they're just waiting for the ideal merger partner to appear too.

One key thing that could make Bayer a more attractive partner is the blood-thinner Xarelto, which has a limited approval in Europe and is awaiting the OK from U.S. and EU regulators for stroke prevention. "Whether and to what extent potential 'equals' may be interested in taking up this offer to talk probably depends on the approvability of Xarelto," WestLB analyst Cornelia Thomas wrote in a note to investors (as quoted by Bloomberg). While these "equals" might flirt with a deal before that regulatory news breaks, Thomas said, they certainly wouldn't commit.

- read the Bloomberg story

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