Drug Makers GlaxoSmithKline and Bristol-Myers Squibb Discuss Possibility of a Merger

Pharmaceutical manufacturers GlaxoSmithKline and Bristol-Myers Squibb are discussing the possibility of a merger, the New York Times reports. Executives "close to the talks" said that the two drug makers have held "preliminary discussions" about whether it would be feasible for GSK to purchase Bristol-Myers (Petersen/Sorkin, New York Times, 5/31). The Times of London reports that because both companies are "large players" in HIV/AIDS medicines, a merger may have anti-trust implications, resulting in one company "being required to spin off its interests in that area." Although a merger "would complement both sides," relinquishing control over HIV/AIDS drug development and marketing "would be an unattractive prospect for both," the Times says (Rayner, Times of London, 6/1). Some analysts say that a merger between the companies would "not solve their essential problem," which is that each is "struggling" to develop new medicines. Viren Mehta, a partner at the health care investment firm Mehta Partners, said that although a merger may not lead to a plethora of new drugs for the two companies, it would create "significant savings" by lowering administrative costs (New York Times, 5/31). Bristol-Myers last week announced that it submitted an application to the European Medicines Evaluation Agency for marketing approval of its new antiretroviral drug atazanavir. The drug, currently in phase III clinical development, is a protease inhibitor that is taken once per day (Kaiser Daily HIV/AIDS Report, 5/30). Bristol-Myers also produces the antiretroviral drugs didanosine (Videx), stavudine (Zerit) and efavirenz (Sustiva) (Bristol-Myers Web site, 6/3). GlaxoSmithKline manufacturers the antiretroviral drugs lamivudine (Epivir), zidovudine (Retrovir), abacavir (Ziagen) and amprenavir (Agenerase). The company also produces the combination pills Combivir (zidovudine/lamivudine) and Trizivir (abacavir/lamivudine/zidovudine) (GlaxoSmithKline Web site, 6/3).