Bristol Myers Squibb Research and Development Center at Cambridge Crossing in Cambridge, Massachusetts, December 27, 2023.
Adam Glanzman | Bloomberg | Getty Images
Bristol Myers Squibb on Thursday reported first-quarter revenue that topped expectations as sales of its popular blood cancer drug Revlimid and blockbuster blood thinner Eliquis were stronger than expected.
However, the pharmaceutical company reported a quarterly loss due to one-time charges related to recently closed deals. It also said it plans to cut costs by $1.5 billion by 2025 and reinvest the money in drug development.
Bristol Myers will lay off 2,200 workers this year, discontinue some drug programs, eliminate vacant positions, consolidate its divisions and reduce management levels, among other savings. The company said it will prioritize investments in its key drug brands, optimize operations across the company and focus its resources on research and development programs that can deliver the highest profits for the company and the greatest health benefits for patients.
Two-thirds of the savings are related to drug research and development, Bristol Myers executives said on an earnings call Thursday. The company has discontinued about 12 drug programs so far and plans to discontinue others within the year, said Bristol Myers Chief Medical Officer Dr. Samit Hirawat.
Bristol Myers CEO Chris Boerner added that most of the savings come from existing internal operations rather than newly acquired companies.
“We are taking essential steps to effectively manage the decade,” Boerner said during the call. “Our management team is focused on ensuring we have the discipline required to deliver results both this year and prepare us for the long term.”
In the first quarter, Bristol Myers stated that the allegations against it primarily reflect its dynamics $14 billion acquisition manufacturer of neurological drugs Karuna Therapeutics i cooperation agreement with SystImmune, a subsidiary of a Chinese biotechnology startup, to jointly develop and commercialize an experimental cancer treatment.
These deals come as Bristol Myers faces pressure to launch recent drugs and offset potential loss of revenue from its best-selling drugs. The company’s popular blood cancer drug Revlimid – and eventually Eliquis and cancer immunotherapy Opdivo – faces competition from cheaper copycats.
Shares of Bristol Myers fell more than 7% on Tuesday.
Here’s Bristol Myers’ first-quarter report compared to Wall Street expectations, based on a survey of analysts conducted by LSEG:
- Loss per share: Adjusted $4.40 vs. expected loss of $4.44
- Income: USD 11.87 billion against the expected USD 11.46 billion
Bristol Myers, one of the world’s largest pharmaceutical companies, reported a first-quarter net loss of $11.9 billion, or $5.89 per share. That compares with net income of $2.3 billion, or $1.07 per share, in the same period a year ago.
After excluding certain items, adjusted loss per share for the period was $4.40.
The loss reflects a one-time charge of $6.30 per share related to recently closed transactions, Bristol Myers said in a statement.
Bristol Myers reported first-quarter revenue of $11.87 billion, up 5% from the year-ago period.
The company maintained its full-year revenue forecast assuming low single-digit growth. However, Bristol Myers lowered its 2024 adjusted earnings forecast from 40 cents per share to 70 cents per share to reflect the impact of recent transactions.
That compares with the previous forecast of $7.10 to $7.40 per share, which did not include charges related to the buyout of Karuna Therapeutics and radiopharmaceutical company RayzeBio, as well as divestitures and other items.
Eliquis, recent drugs after growth
Bristol Myers said first-quarter revenue growth was primarily due to higher sales of Eliquis and some of its newer drugs.
Eliquis reported sales of $3.72 billion for the quarter, up 9% from the year-ago period. Analysts had expected Eliquis to post revenue of $3.59 billion, according to estimates compiled by FactSet.
Eliquis, which Bristol Myers shares Pfizer, is one of the first 10 drugs subject to price negotiations under the federal Medicare program. The blood thinning drug is expected to lose market exclusivity by 2028.
During the call, Bristol Myers executives said the impact of these negotiations on Eliquis was still unclear. The final negotiated price for the drug will be published later this year and will take effect in 2026, when the company expects significant growth in revenues and profits.
Meanwhile, Revlimid earned $1.67 billion in sales, down 5% from the same period a year ago.
But it topped analysts’ expectations for revenue of $1.22 billion for the drug, according to FactSet estimates.
Anemia drug Reblozyl and advanced melanoma treatment Opdualag also saw revenue growth in the first quarter.
Reblozyl reported sales of $354 million, an enhance of 72% compared to the same period last year. Analysts expected revenue of $330.8 million, according to FactSet.
Opdualag generated first-quarter sales of $206 million, up 76% from the same period a year ago. Analysts expected revenue of $206.5 million, according to FactSet estimates.
The results of other recent drugs did not meet Wall Street expectations.
Abecma, a cell therapy used to treat a occasional blood cancer called multiple myeloma, had sales of $82 million in the quarter. Analysts expected revenue of $112.6 million, according to FactSet.
Earlier this month, the U.S. Food and Drug Administration expanded its approval of the drug, allowing patients with multiple myeloma to operate it as an earlier line of treatment.
The older drug, Opdivo, generated $2.07 billion in sales in the quarter, down 6% from the first quarter of 2023. Analysts expected sales of the drug to be $2.3 billion during the period, according to FactSet estimates.
