Release Date: October 31, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Bristol-Myers Squibb Co (BMY, Financial) reported a 20% increase in growth portfolio revenues in Q3, now accounting for approximately half of total revenues.
- The company achieved several clinical and regulatory milestones, including the FDA approval of COBENFY for schizophrenia and an OPDIVO-based treatment for non-small cell lung cancer.
- Bristol-Myers Squibb Co (BMY) is on track to deliver $1.5 billion in savings by the end of 2025, which will be reinvested into high ROI opportunities.
- The company is making progress in its late-stage pipeline, with promising developments in milvexian for atrial fibrillation and other indications.
- Bristol-Myers Squibb Co (BMY) raised its full-year revenue target and EPS guidance due to strong performance year-to-date.
Negative Points
- The third quarter sales were impacted by the reversal of an approximate $150 million inventory build from the second quarter, affecting several brands.
- Bristol-Myers Squibb Co (BMY) faces competition from generics for products like Sprycel, Abraxane, and POMALYST, which could impact future sales.
- The company anticipates a step-up in gross to net discounts for SOTYKTU due to increased rebating, which may affect short-term sales.
- There are concerns about the lower-than-expected event rate in the milvexian trial, which could impact the study's outcome.
- The launch of COBENFY is expected to take about a year to achieve 80% to 85% access, with sales ramping up in the second half of 2025.
Q & A Highlights
Q: Can you walk us through what the next year looks like for COBENFY in terms of access, especially regarding Medicaid and commercial plans?
A: Adam Lenkowsky, Executive Vice President & Chief Commercialization Officer, explained that COBENFY is expected to launch in 2025 with sales ramping up in the second half of the year after achieving broad access. The product is available now, and field teams are engaging with customers. Access is crucial as over 80% of patients are on Medicare or Medicaid. It is anticipated that 80% to 85% access will be achieved within a year, with Medicaid potentially moving faster.
Q: What are your expectations for the 2025 top-line dynamics in relation to operating expenses?
A: David Elkins, Executive Vice President, Chief Financial Officer, stated that the company is on track with its $1.5 billion savings initiatives and expects to achieve the majority of these savings this year. The operating margin guidance of at least 37% is maintained for both this year and next. Full guidance for 2025 will be provided during the fourth-quarter earnings call.
Q: Once reimbursement is in place for COBENFY, how do you anticipate the drug's ramp-up?
A: Adam Lenkowsky noted that COBENFY's launch will be gradual, with full access expected within 12 months post-approval. The drug's unique mechanism of action and unmet need in schizophrenia could lead to a faster ramp than historical launches. The company is also confident in the bipolar 1 opportunity, with plans to initiate a program in 2025.
Q: Could you provide more color on SOTYKTU's pricing and access outlook for next year?
A: Adam Lenkowsky mentioned that SOTYKTU's performance has been slower than desired, but progress is being made in securing favorable access. The company has doubled its access to approximately 50% zero-step edits in the market and expects broader access and adoption in 2025, despite significant rebating and gross-to-net impacts.
Q: What is the cause of the lower event rate in the milvexian trial, and does it change the risk profile?
A: Samit Hirawat, Executive Vice President, Chief Medical Officer, explained that the lower event rate is encouraging and aligns with the study's design. The Data Monitoring Committee supports continuing the study, and the company remains confident in the program's design and progress.
Q: Can you discuss the potential market for the GPRC5D CAR-T relative to Abecma?
A: Samit Hirawat stated that the GPRC5D CAR-T program is progressing well and is expected to move into Phase 3 registrational trials. The asset is anticipated to be used after BCMA CAR-T treatment, and the company is encouraged by its potential in the competitive cell therapy landscape.
Q: How do you view Bristol-Myers as a sustainable growth company, especially with 2026 revenue pressures?
A: Christopher Boerner, Chairman of the Board, Chief Executive Officer, emphasized the company's focus on executing short-term goals while building for long-term growth. The young portfolio of growing assets, progress in the late-stage pipeline, and financial discipline are key components driving sustainable growth.
Q: What are your expectations for the adjunctive COBENFY data set next year?
A: Samit Hirawat highlighted that the adjunctive therapy data will showcase COBENFY's efficacy and safety profile when combined with background therapies. The study is expected to read out in 2025, and the company is focused on driving on-label use in schizophrenia.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
