Reports of merger talks between AstraZeneca and Bristol Myers Squibb that triggered a significant drop in AstraZeneca’s market value have been disputed, with sources denying any formal discussions took place. Initial reports suggested that the two pharmaceutical giants were exploring a deal that could have created a combined entity valued at nearly $400 billion, potentially reshaping the global pharmaceutical landscape.

The Financial Times initially reported that AstraZeneca, the second-largest company on the London market, had engaged in conversations with its New Jersey-based rival over recent months. This news led to an immediate market reaction, wiping close to £18 billion—or about 9 percent—off AstraZeneca’s market capitalization. However, a senior source quoted by Reuters stated there were “no discussions” and “never a deal to be done” between the companies, calling the merger rumors into question.

Despite the denial, industry analysts expressed skepticism at the possibility of such a merger. John Murphy, a senior pharmaceutical analyst at Bloomberg Intelligence, described the potential combination as having “limited strategic sense.” Jefferies also labeled the reports “perplexing,” pointing to overlaps in the companies’ drug portfolios, especially in the oncology space, as well as regulatory challenges and concerns about the impact on research and development.

Both firms face approaching patent expirations on key cancer and cardiovascular drugs. AstraZeneca’s sales in cancer treatments were projected to reach approximately $25 billion in 2025, representing nearly half its revenue, with cardiovascular, renal, and metabolism treatments contributing another $12 billion. Key oncology products such as Tagrisso, Calquence, and Imfinzi are expected to lose patent protection in the early 2030s. Bristol Myers Squibb faces similar challenges with drugs like the blood thinner Eliquis and the cancer therapy Opdivo, with their cancer immunotherapies directly competing in the market.

Market observers also noted AstraZeneca’s recent strategic shift toward the U.S., including substantial investments in U.S. manufacturing and an upgrade of its New York stock listing earlier this year. The company aims to derive half of its targeted $80 billion in annual revenue by 2030 from the U.S. market, fueling speculation that a merger might accelerate this pivot.

The Financial Conduct Authority declined to comment on whether it was investigating trading patterns related to the reports for potential market abuse. Following the Reuters report refuting merger talks, AstraZeneca’s shares regained some ground, rising about 3 percent, though they remained 5 percent below pre-rumor levels.

Both AstraZeneca and Bristol Myers Squibb declined to comment on the merger speculation. The unfolding situation underscores the sensitivity of market responses to merger rumors in the pharmaceutical sector and the complexity of consolidations involving major drugmakers with overlapping product lines and patent timelines.