Bristol Myers Squibb is spinning off a fresh company armed with five autoimmune disease drugs and $300 million in Bain Capital-led financing as part of the Big Pharma’s ambitious cost-cutting drive.
The new biotech, which has yet to be named, will be focused on five drugs licensed from BMS, three of which are already in the clinic. The most advanced of these are afimetoran, a TLR7/8 inhibitor being evaluated in a phase 2 study for systemic lupus erythematosus (SLE), and BMS-986322, an oral TYK2 inhibitor that successfully completed a midstage plaque psoriasis trial but has since stalled.
Further behind is BMS-986326, an IL2 fusion protein being studied in phase 1 trials for SLE and atopic dermatitis. The new biotech will also have ownership of BMS-986481 and BMS-986498, which BMS described as “two phase 1-ready biologics targeting the IL18 and IL10 pathways, respectively.”
The new company may not have a name yet, but it will have a hefty bank balance courtesy of a $300 million financing commitment led by investment firm Bain. BMS will hold a “nearly” 20% equity stake in the biotech and will be in line for royalties and milestone payouts should the meds prove successful. The pharma’s chief research officer Robert Plenge, M.D., Ph.D., will serve on the new company’s board.
The spinout comes amid a time of major retrenchment at BMS. The company announced in February that is aiming to save $2 billion by the end of 2027, on top of a separate $1.5 billion savings initiative the drugmaker laid out back in April 2024.
BMS placed today’s news in the context of the company’s “strategic shift in immunology research to focus on assets that have the potential to reset the immune system and promote tissue repair.”
“It also further demonstrates the company’s sharpened strategy to invest in areas where BMS is best positioned to lead, while enabling the continued development of promising medicines,” the pharma added in the July 28 post-market release.
The decision to hand over the psoriasis med BMS-986322, in particular, won’t come as a big surprise to close observers. Back in February, Samit Hirawat, M.D., head of development at BMS, fielded an analyst question on the lack of progress since BMS-986322’s trial wrapped up, explaining that “we have to decide within our pipeline where we are going to really focus and prioritize.”
“At the current time, our focus is truly squarely on [plaque psoriasis drug] Sotyktu and maximizing that opportunity from a development and commercial perspective,” Hirawat said on the February earnings call. “So, at this time, that TYK2 is not in development.”
In Monday’s release, Julie Rozenblyum, senior vice president, business development at BMS, claimed the five assets handed to the new company “have significant potential, and we are confident that this new company will drive their development to ensure greater impact for patients.”
“Bain Capital’s exceptional track record in building successful life science companies by providing focused development and dedicated resources makes them ideally suited to advance these assets to realize their full promise,” Rozenblyum added.
Daniel Lynch, who sits on the boards of biotechs like Xilio, Springworks and Blueprint, has been tapped to serve as executive chairman of the new company’s board of directors as well as interim CEO.
“This is a unique opportunity to build an innovative biotech company with a strong scientific foundation and differentiated development capabilities,” Lynch said in the release. “I’m thrilled to have the opportunity to leverage my background and experience to contribute to the success of the company as it seeks to develop much-needed new therapies, and I look forward to supporting BMS and Bain Capital in the build-out of the company’s operations.”