Would BMS-Celgene control too much of the psoriasis business? FTC wants to find out

FTC building
The FTC has asked for more info on BMS and Celgene's psoriasis products. (Wikimedia Commons)

Turns out shareholders aren’t the only ones who have some issues with Bristol-Myers Squibb’s proposed $74 billion Celgene merger.

The Federal Trade Commission (FTC) is taking a closer look at the companies’ psoriasis drugs, both those on the market and those making their way through the clinic, Celgene said in a regulatory filing (PDF). The agency asked Bristol-Myers and Celgene Monday to hand over additional info and documents about their respective drugs.

Celgene said the companies “will continue to cooperate with the FTC staff in its review of the transactions contemplated by the Merger Agreement.”

Right now, Bristol and Celgene don’t think the review will throw off their deal timeline; they still expect the transaction to wrap in this year’s third quarter. But a potential overlap in psoriasis offerings, as determined by the FTC, could result in castoffs of marketed or pipeline products—a scenario that could hurt the combined company's prospects as it aims to become a top immunology player.

RELATED: Celgene notches positive Otezla data in scalp psoriasis as it guns for market expansion

Celgene sells Otezla, a next-generation pill that treats the skin disease. Sales have ramped up lately, with the therapy churning out $448 million in the fourth quarter to surpass last year’s haul in the same period by more than 20%. And the New Jersey drugmaker is still looking to widen Otezla’s reach: In October, it posted positive phase 3 study results in scalp psoriasis.

Bristol-Myers, meanwhile, wants to upend the market with its own psoriasis newcomer, a fellow oral option currently in phase 3. Last September, the candidate put up stellar phase 2 results, showing it could dramatically reduce symptoms in 12 weeks of treatment.

RELATED: Can BMS rebels scuttle its Celgene buy? Analysts do the math—and so far, the votes don't add up

But the FTC isn’t the only force that could potentially stop the two drugmakers from joining forces. Activist investor Starboard Value has been trying to thwart the mammoth merger by rallying “no” votes from fellow shareholders—such as top stakeholder Wellington Management, which has already come out against the deal. Analysts, though, say for the time being that they still foresee the transaction going through.

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