AstraZeneca and Bristol Myers Squibb are in talks to combine in a deal that could be worth $400bn. The UK‑listed drugmaker, valued at about £196bn, has recently finished a direct listing in New York, a move that has hurt the London market.

A partnership would create one of the largest pharmaceutical groups ever, pushing the merged entity into the top four by market capitalisation. Sir Pascal Soriot, AstraZeneca’s chief executive, sees the deal as a way to extend the company’s footprint in the US and to counter fears that UK‑based firms are moving overseas. The UK government could oppose the tie‑up, particularly if it leads to redomiciliation in the US, and regulators will scrutinise the transaction for antitrust concerns, given the size of both companies’ cancer portfolios.

While talks are ongoing, the companies say a deal could materialise soon but could also be delayed or collapse. The potential megadeal underscores the growing trend of cross‑border mergers in the pharma sector, as firms seek scale and new markets in a regulatory and political environment that is increasingly complex.