BRISTOL MYERS SQUIBB CO Q3 FY2024 earnings call

Management Statement and Operational Highlights

• Growth and Legacy Performance: Growth portfolio saw 20% growth at constant currency, while legacy portfolio generated cash flow for strategic investments.
• Clinical and Regulatory Milestones: Approved Cobenfy in neuroscience; FDA approved Opdivo-based perioperative treatment in non-small cell lung cancer; advanced oncology pipeline with ESMO data and Phase 3 advancements.
• Karuna Acquisition: Highlighted FDA approval of Cobenfy, with ongoing clinical programs (e.g., Phase 3 adjunctive schizophrenia, Phase 3 Alzheimer's psychosis) and registriational trials planned.
• Strategic Priorities: Focus on transformational medicines, operational excellence (aiming for $1.5B in cost savings by 2025), and strategic capital allocation for growth.
• Upcoming Milestones: Presentations at ACR for CD19 NEX-T cell therapy; FDA decision on nivolumab subcutaneous formulation by late December; top-line Phase 3 data for Sotyktu in psoriatic arthritis by year-end.

Segment Performance

• Growth Portfolio: Generated 20% growth at constant currency in Q3, accounting for approximately half of total revenues. Key brands like Reblozyl, Breyanzi contributed to this growth.
• Legacy Portfolio: Performed well, with U.S. growth led by Eliquis, but offset by lower sales of Sprycel. Revlimid's full-year sales estimate was updated to approximately $5.5 billion.

Guidance

• Revenue: Raised full-year revenue target to ~5% growth on a reported basis and ~6% at constant currency, driven by strong sales of Revlimid.
• EPS: Raised non-GAAP EPS guidance to a range of $0.75 to $0.95.
• Margin: Confident in achieving operating margin target of at least 37%.

Risks

• Generic Competition: Impact on sales of Sprycel, Abraxane, and Pomalyst due to generic entry.
• Clinical Trial Uncertainties: Uncertainties in trial outcomes, event rates, and regulatory approvals for pipeline programs.
• Reimbursement Challenges: Access issues for Cobenfy in Medicaid and Medicare, affecting sales ramp.

Question and Answer

Q: On Cobenfy access and ramp A: Discussed steps for access, with expected full access (80-85%) within 12 months post-approval and ramping in the second half.

Q: On Milvexian trial update A: Encouraged by lower event rates leading to sample size increase, with data readout in 2027.

Q: On CD19 NEX-T cell therapy and IRA impact A: Positive data at ACR, with IRA impact seen as net neutral across the portfolio.

Q: On GPRC5D CAR T and Milvexian timelines A: GPRC5D agent in Phase 2, Milvexian data readout scheduled for 2027.