Allergan CEO says "everybody" likely looking at Bristol-Myers Squibb: report

Allergan CEO Brent Saunders suggested that a number of companies will be looking at Bristol-Myers Squibb as a potential takeover target given its share price decline over the past six months, Bloomberg reported Thursday. "I think everybody is looking at [Bristol-Myers Squibb]," Saunders remarked, adding for any chief executive, "you're going to at least take five minutes to think about it."

Earlier this week, Bristol-Myers Squibb announced an agreement with shareholder JANA Partners to add three independent members to its board, while a later report suggested that activist investor Carl Icahn has taken a stake in the drugmaker. "Carl is a very smart, thoughtful investor. I have to believe that he looks at Bristol-Myers [Squibb] and the industry and he's saying, 'great company, great pipeline and an industry that should potentially consolidate.' So that's a formula that Carl tends to like," Saunders commented.

However, Saunders indicated that it would be a "very, very high hurdle" for a company like Allergan to acquire Bristol-Myers Squibb, which has a current market of about $92.6 billion. Other potential suitors for Bristol-Myers Squibb have been said to include Gilead Sciences, Novartis and Pfizer. Commenting on the speculation, Thrivent Financial analyst David Heupel remarked "if you believe in the immuno-oncology franchise, then [Bristol-Myers Squibb is] obviously an attractive asset because there's not many ways to get into this space."

Heupel added that a deal would make sense for Pfizer "if they feel like they needed to make a move and become a very relevant player in immuno-oncology." Although the drugmaker has forged a partnership with Merck KGaA in immuno-oncology, the company is considered to trail Bristol-Myers Squibb and Merck & Co. in this sector.

Additionally, speculation regarding Novartis' potential interest in Bristol-Myers Squibb comes as the Swiss drugmaker is considering strategic options for its Alcon eye-care division, including a spin-off that could worth up to $20 billion, according to Bloomberg Intelligence analysts. Novartis also holds a stake in fellow Swiss company Roche that could be worth as much as $13 billion.

Meanwhile, Gilead's rumoured interest in a purchase of Bristol-Myers Squibb has been sparked by slowing sales of the former's hepatitis C franchise. Earlier this month, Gilead unveiled lower-than-expected revenue guidance for 2017, including decreased revenue for its hepatitis C portfolio.