Schering-Plough Corp. (SGP) is seriously considering approaching Bristol-Myers Squibb Co. (BMY) about a possible merger, according to a report in The Star-Ledger newspaper Friday.

The report, citing three people with direct knowledge of Schering-Plough's deliberations, said a merger would give Schering-Plough a coveted drug-discovery pipeline and a formidable stable of cancer treatments and antiviral therapies for HIV/AIDS and Hepatitis C.

Steve Galpin, a spokesman for Schering-Plough, declined to comment on the report.

Tony Plohoros, a spokesman for Bristol-Myers, said the company doesn't comment on speculation, but said, "With eight FDA approvals in the last four years coupled with our strong late-stage pipeline, we feel we're well positioned for growth. That said, we will always look to do what is in the best interests of shareholders."

Several of the world's top drug makers may weigh acquiring Bristol-Myers, analysts have said, but they also said that suitors seem unlikely to bid before next summer.

For Bristol-Myers, which this week fired its chief executive, Schering-Plough could bring revenue from the hot-selling cholesterol fighter Vytorin, along with a chief executive, Fred Hassan, who is an experienced turnaround artist and one of the most respected leaders in the industry.

"The concept would be the management of Schering-Plough would be the management of the joint company," one of the people involved with the discussions said, according to the Star-Ledger. "One of the intangibles in this is Fred himself."

The New Jersey paper's report noted that people with knowledge of Schering-Plough's strategy said such a merger plan has been discussed internally for months. However, Schering-Plough has yet to approach Bristol-Myers with a proposal.

Schering-Plough's strategy would be to orchestrate a "reverse merger," under which Bristol-Myers would acquire Schering-Plough for stock to form a merger of equals, according to the paper, citing people with knowledge of Schering-Plough's thinking.