AstraZeneca’s shares fell sharply in early trading as investors expressed clear scepticism over a potential merger with US rival Bristol Myers Squibb.
The UK drugmaker’s stock dropped six per cent to 11,866p after reports emerged that the FTSE 100 giant had been exploring a possible $400bn megadeal with the American pharmaceutical group.
According to the Financial Times, AstraZeneca has been holding talks with Bristol Myers Squibb in recent months over a possible tie-up between the two companies.
Unlike most major FTSE takeovers and mergers, which typically cause share prices to spike as investors anticipate the upside, AstraZeneca’s opening reaction pointed sharply in the opposite direction.
Richard Hunter, head of markets at Interactive Investor, said the share price move sends “a clear signal that investors would potentially be opposed to such a deal.”
Hunter noted the proposed deal raised fresh questions about AstraZeneca’s ties to the UK, as chief executive Pascal Soriot continues to push the firm further into the American market.
Soriot has previously described the drugmaker as a “very American company,” and the group now operates 23 sites across 11 US states, spanning manufacturing, research, and development.
Last September, AstraZeneca upgraded its listing on the New York Stock Exchange to allow American investors to buy shares directly, a move widely viewed as a blow to the London market.
The company also struck a $50bn deal with Donald Trump’s administration to invest in US manufacturing and research facilities, deepening its American footprint still further.
Despite this growing transatlantic focus, AstraZeneca has repeatedly insisted it will remain headquartered in Cambridge and retain its London listing, pledging to invest £300m into its UK operations as recently as April.
That commitment came shortly after the group cancelled plans for a new Cambridge laboratory and a site in Macclesfield, moves that had already unsettled some investors ahead of the merger news.
Hunter said: “It seems that investors are wondering why Astra would turn on its heels, having recently eschewed any M&A activity and having a strong pipeline which leaves it more than capable of standing on its own feet, at least until 2030.”
He added: “The additional distractions of such a deal, let alone any regulatory intrusion, would be even more complicated, coming at a time when the US appears to be doubling down on its domestic development rather than opening the door to a major international stake.”
The potential deal has also stoked wider fears about the health of the FTSE 100, which has already been battered by a wave of takeover activity in 2026, with AstraZeneca ranking as the UK’s second most valuable listed company behind only HSBC.
Russ Mould, investment director at AJ Bell, said: “The speculated blockbuster merger between AstraZeneca and US rival Bristol Myers Squibb would have implications outside of the pharmaceutical sector.”
Mould warned: “The fear will be that such a move, coming on top of the company’s recent direct listing in New York, would pull its centre of gravity across the Atlantic and ultimately see the UK stock market lose one of its crown jewels.”
Analysts have also questioned the sheer scale of the proposed transaction, with a combined valuation of $400bn surpassing even the landmark $350bn Vodafone and Mannesmann merger of 2000.
Both companies share an overlapping focus in oncology, meaning any deal would face substantial antitrust scrutiny, particularly in the United States, where regulators have grown increasingly assertive.
Cancer treatments accounted for roughly $25bn of AstraZeneca’s 2025 sales, while oncology drugs made up more than 40 per cent of Bristol Myers Squibb’s total sales in the first half of 2026.
Mould said “major transactions of this kind often run into difficulties” and warned that “getting a deal across the line could be as difficult as putting together a 10,000-piece jigsaw.”
He also cautioned that “political pressure might also be brought to bear, particularly on these shores given the importance of AstraZeneca to UK plc.”