Over the past two years, Bristol-Myers Squibb ($BMY) has been widely lionized for its successful "string of pearls" approach to drug development. Now one of the chief authors of the strategy is headed to Teva ($TEVA), where analysts widely believe he'll try to replicate the strategy. And that could lead to some big paydays for biotechs which attract his interest.
Jeremy Levin, the Cambridge-educated senior vice president for strategy at BMS, has been tapped to fill the CEO post at Teva, which has been growing rapidly under outgoing CEO Shlomo Yanai. Now analysts expect Levin to start doing deals that can bring in drugs like Yervoy (Medarex buyout, 2009).
"His appointment clearly signals that Teva will remain acquisitive in building its brand business but at appropriate scale since Levin will likely attempt to recreate his "string of pearls" success," noted Barclays. "Indeed, this should alleviate investor concerns that Teva would make additional large acquisitions in order to achieve its 2015 guidance targets. In particular, we believe Levin will drive acquisitions in oncology, which has been a focus for Teva business development for some time, including the Cephalon acquisition."
"He's the perfect guy for this," Sphera Funds' Ori Hershkovitz tells Bloomberg. "If Jeremy can do one or two good product selections as he has done in the past for Bristol-Myers, that will be very, very good for Teva."