AstraZeneca has held preliminary talks with US rival Bristol Myers Squibb (BMS) about a merger that would create a combined group worth close to $400bn, the Financial Times reported today. A deal of that size would rank among the largest in pharmaceutical history and form the world’s fourth largest drugmaker by market cap. Neither company confirmed the report, and sources cautioned that the discussions are early-stage and may never result in a transaction. The market responded regardless: AstraZeneca – the UK’s second most valuable listed company, worth around $264bn – fell as much as 7% in London, while BMS, valued at roughly $133bn, rose in New York. Whether the talks progress or quietly collapse, they have certainly reopened questions about the company’s long-term direction.