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  "documentTitle": "Bristol-Myers Squibb Company (BMY)",
  "authorId": "03_Starboard_Value",
  "authorName": "Starboard Value",
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  "presentationDate": "2019-03-18 00:00:00",
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  "notes": "Uses a logical breakdown to expose a flaw in management's acquisition accounting.",
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      "text": "Bristol-Myers’ math is misleading and ascribes an artificially low value to the pipeline",
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      "text": "Similarly, Bristol-Myers management's base case assumption is that marketed products revenue will be essentially $0 after 2028, but management assumes $2.5 billion of synergies from 2029 into perpetuity. This would mean that after 2028, there will be $0 revenue from marketed products but $2.5 billion in EBITDA – this is obviously also impossible!",
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      "text": "Management asserts that the ~$90 billion acquisition breaks down roughly as follows: Marketed Products: ~$55 billion; Cost Synergies: >$20 billion; Pipeline: Implied to be ~$15 billion",
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      "text": "However, we believe management is not properly allocating the value of the cost synergies.",
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      "text": "In order to assume that Bristol-Myers is paying only ~$15 billion for the pipeline, we would have to allocate all cost synergies to marketed products. However, fully allocating cost synergies to marketed products implies that marketed products EBITDA will be greater than revenue starting in 2024 – this is impossible.",
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      "text": "When properly allocating synergies, we calculate that Bristol-Myers is paying ~$30 billion for the pipeline, not $15 billion.",
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      "text": "Bristol-Myers argues that the Celgene merger is a low-risk proposition. We disagree.",
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      "text": "Bristol-Myers' presentations suggest that the Company is acquiring Celgene's pipeline for only ~$15 billion.",
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      "text": "pipeline valuation: $30 billion",
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      "text": "We Believe Bristol-Myers Is Actually Paying ~$30 Billion for the Pipeline, Not ~$15 Billion",
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