Analyst Conference Summary


Bristol-Myers Squibb

conference date: August 6, 2020 @ 5:30 AM Pacific Time
for quarter ending: June 30, 2020 (second quarter 2020)

Forward-looking statements

Overview: Revenue up y/y both from Celgene acquisition and on a pro-forma basis. GAAP loss, but non-GAAP EPS strong.

Basic data (GAAP):

Revenue was $10.13 billion, down 6% sequentially from $10.78 billion and up 61% from $6.27 billion year-earlier.

Net income was negative $85 million, up sequentially from negative $775 million and down from $1.43 billion year-earlier.

EPS (earnings per share), diluted were negative $0.04, up sequentially from negative $0.34, and down from $0.87 year-earlier.


Updated guidance, decreased GAAP EPS to negative $0.06 to $0.09, increased non-GAAP EPS to $6.10 to $6.25.

Conference Highlights:

The Celgene acquisition closed on November 20, 2019, so Q2 is the second full quarter incorporating it. Most revenue increase y/y was due to the acquisition. Pro-forma y/y revenue flat due to pandemic impact of about $600 million. GAAP numbers were again impacted by expenses related to the Celgene acquisition.

Giovanni Caforio, M.D., CEO of Bristol-Myers Squibb stated "Our teams drove strong commercial execution while continuing to progress our integration initiatives. With several new product launches and the achievement of multiple milestones from our late-stage pipeline, I am confident that we are building a leading biopharma with a renewed portfolio of transformational medicines. Our financial flexibility and continued opportunities to invest in innovation position us well to deliver for the long-term." The Celgene and Bristol teams are coming together, hope to deliver $2.5 billion in synergies by the end of 2022. Recruiting for clinical trials has resumed. Believes Opdivo will return to annual sales growth in 2021.

U.S. revenues increased 77% y/y to $6.5 billion. International revenue was up 40% y/y to $3.6 billion.

In August 2020, the U.S. District Court decised to uphold both the composition of matter patent (US 6,967,208) and formulation patent (US 9,326,945) covering Eliquis (apixaban).

In May 2020 the FDA approved Opdivo plus Yervoy for the first-line metastatic or recurrent NSCLC with no EGFR or ALK genomic tumor aberrations.

Non-GAAP numbers: diluted EPS $1.63, down 6% sequentially from $1.72 and up 38% from $1.18 year-earlier. Net income $3.75 billion, down 5% sequentially from $3.96 billion, and up % from $na billion year-earlier.

Cash and equivalents ended at $19.8 billion were up sequentially from $19 billion. Long-term debt was $41.9 billion (avg rate 3.4%). Does not plan share repurchases in the current environment.

sales in $ millions
Q2 2020
Q2 2019
y/y change
Revlimid $2.884 0 na
Opdivo 1,653 1,823 -9%
Eliquis 2,163 2,042 6%
Orencia 750 778 -4%
Pomalyst/Imnovid 745 na na
Sprycel 511 544 -6%
Yervoy 369 367 1%
Abraxane 308 na na
Empliciti 97 91 7%
Reblozyl 55 0 na
Inrebic 15 0 na
Zeposia 1 0 na
Baraclude 121 147 -18%
Vidaza 126 na na
Other 331 481 -31%
Total 10,129 6,273 61%

In March 2020 Zeposia (ozanimod) was approved by the FDA for relapsing/remitting multiple sclerosis. In August 2020 announced positive topline results in ulcerative colitis.

In July resubmitted liso-cel BLA. In May 2020, Bristol announced that the FDA extended the action date by three months for the BLA for lisocabtagene maraleucel (liso-cel). The new U.S. FDA action date is November 16, 2020. In March, the company and bluebird bio had announced the submission of their Biologics License Application (BLA) to the U.S. FDA for idecabtagene vicleucel (ide-cel; bb2121), the investigational B-cell maturation antigen (BCMA)-directed chimeric antigen receptor (CAR) T-cell immunotherapy, for the treatment of adult patients with multiple myeloma who have received at least three prior therapies.

In May 2020 the FDA accepted for Priority Review the New Drug Application (NDA) for CC-486 for maintenance treatment of adult patients in remission with acute myeloid leukemia (AML) with an action date of September 3, 2020.

In April 2020 the FDA approved Reblozyl for the treatment of anemia in adult patients with very low- to intermediate-risk myelodysplastic syndromes (MDS) who have ring sideroblasts and require red blood cell (RBC) transfusions. Reblozyl is licensed from Acceleron.

In June, 2020, the FDA approved of Opdivo (nivolumab) for the treatment of patients with unresectable advanced, recurrent or metastatic esophageal squamous cell carcinoma (ESCC) after prior fluoropyrimidine- and platinum-based chemotherapy.

In June 2020, Bristol and Acceleron Pharma Inc. announced the European Commission approved Reblozyl (luspatercept) for the treatment of transfusion-dependent anemia in adult patients with myelodysplastic syndromes (MDS) or beta thalassemia.

Cost of products sold was $2.70 billion. SG&A $1.63 billion. R&D $2.52 billion. Amortization $2.39 billion. Other income $0.74 billion. Total expenses $8.50 billion. Operating income $1.63 million. Tax expense $1.71 million.

Q&A summary:

Opdivo lung demand trend? First line lung launch is going well, perhaps a bit ahead of expectations. Share now in mid-single digits, has momentum.

TYK2i opportunity? Psoriasis and psoriatic arthritis Phase 2 data were good, there is still substantial unmet medical need.

Opdivo adjuvant studies? There are many opportunities. Readouts in 2020 would be melanoma, muscle invasive bladder cancer, NSCLC. In 2021 more.

TYK2i safety profile? Safety in psoriatic arthritis similar to psoriasis.

Opdivo? We are emphasizing dual IO therapy across segment types, based on 227 data.

Eliquis ruling, generics arrival? Composition matter expires in 2026. Formulation patent expires in 2031. Strength of both has been confirmed. We have settled with a number of companies, but he terms are confidential.

Ozanimod differentiation? Ulcerative colitis treatment is mainly biologics. Oral therapy is an opportunity. Zeposia Phase 3 met primary endpoint and important secondary endpoints, like less infections, which other drugs have not met. We are preparing for a submission for this indication.

Cash piling up, deals in the future? Will achieve one-third of synergies next year, we are very confident on execution. For capital allocation, nothing has changed, will continue to source external innovation that is aligned stategically. We are always looking at potential deals.

Concern in Bristol and industry re Trump executive orders? We have not even seen the executive order yet, so there is a level of uncertainty. We feel strongly it is not the right direction for the U.S. to go. Affordability issue should be worked on, we should not import unsustainable pricing from abroad. We need to continue to invest in innovation. Will want to see how HHS implements rebate rule.

Reblozyl inventory building, data readouts? Encouraged by launch, was virtual, good adoption so far. Got a J code in July, which helps with payers. It ships directly, so no inventory issue. There might have been a bolus from unmet medical need, but we are seeing continuing new patient initiation and repeat dosing. The trial readouts would be in 2022.

Opdivo RCC potential sales? Renal cell market share has been steady. 9ER data is encouraging, could be an opportunity to gain share.

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Disclaimer: My analyst call summaries may include both condensations of statements made by company representatives and my own analysis. They are not covered by any warranty. I cannot guarantee anything said by company representatives is true. I try not to make errors, but it is possible. These are my personal notes which I share with other investors and which I use as the basis of my blog and Seeking Alpha articles.

Copyright 2020 William P. Meyers