Bristol-Myers Squibb sued for $6.4B over delayed cancer drug

Bristol-Myers Squibb was sued for $6.4 billion on Thursday for allegedly delaying its Breyanzi cancer drug to avoid payments to shareholders of the former Celgene, which the drugmaker bought in 2019.

According to a complaint in Manhattan federal court, Bristol-Myers failed to use contractually required “diligent efforts” to win US Food and Drug Administration approval for the non-Hodgkin lymphoma drug by a Dec. 31, 2020, deadline.

By missing the deadline, Bristol-Myers was excused from owing an additional $9 in cash to Celgene shareholders for each share they held, enabling it to acquire Celgene at an “enormous discount” and enjoy a “windfall,” the complaint said.

Bristol-Myers bought Celgene for $80.3 billion in cash and stock in November 2019. It won FDA approval for Breyanzi, whose chemical name is lisocabtagene maraleucel, on Feb. 5.

The lawsuit was brought by UMB Bank NA, acting as a trustee for Celgene’s former shareholders.

“We will not be commenting on pending litigation,” Bristol-Myers said in a statement.

The $9 per share “milestone” payment had been contingent on New York-based Bristol-Myers winning FDA approval by specified deadlines for three drugs that Celgene had been developing.

UMB said Bristol-Myers withheld or belatedly submitted critical information to the FDA for Breyanzi’s approval, and did not prepare its manufacturing plants for required inspections.

“Other cellular therapies based on similar technology have received FDA approval without the issues and ineptitude that plagued Bristol-Myers, and in substantially less time,” UMB said.

A lawyer for the Kansas City, Missouri-based bank declined additional comment.

Bristol-Myers won FDA approval for the two other Celgene drugs, Zeposia for multiple sclerosis and Abecma to treat multiple myeloma, by the specified deadlines.