Bristol Myers Squibb, one of the world’s largest pharmaceutical companies, has reported first-quarter revenue that exceeded expectations. The company saw strong sales of its blood cancer treatment Revlimid and blockbuster blood thinner Eliquis, which contributed to the positive results. However, Bristol Myers also reported a quarterly loss due to one-time charges related to recent deals. In response, the company has announced cost reduction measures of $1.5 billion, which will involve laying off employees, discontinuing drug programs, and consolidating sites.
The majority of the cost savings are associated with research and development, as Bristol Myers aims to prioritize investment in its key drug brands and focus on programs that offer the highest returns and health benefits for patients. The company has already discontinued 12 drug programs and plans to evaluate others throughout the year. CEO Chris Boerner emphasized that the savings are coming from existing operations rather than newly acquired companies.
The loss reported by Bristol Myers reflects a one-time charge related to its acquisition of neuroscience drugmaker Karuna Therapeutics and its collaboration with SystImmune, a Chinese biotech startup. These deals were made in response to the pressure the company faces to launch new drugs and offset potential revenue loss from its top-selling treatments. Competition from cheaper copycats threatens the market share of Bristol Myers’ popular drugs like Revlimid, Eliquis, and Opdivo.
Despite the positive revenue results, shares of Bristol Myers fell over 7% following the announcement. The company reported a net loss of $11.9 billion for the first quarter, compared to net income of $2.3 billion for the same period last year. Excluding certain items, the adjusted loss per share was $4.40.
Looking ahead, Bristol Myers reaffirmed its full-year revenue forecast of a low single-digit increase. However, it lowered its 2024 adjusted earnings guidance to reflect the impact of recent deals. The company expects its blood thinner Eliquis to lose market exclusivity by 2028, but the effect of ongoing price negotiations with the federal Medicare program remains uncertain.
In terms of individual drug performance, Eliquis and some newer drugs drove revenue growth for the first quarter. Eliquis generated $3.72 billion in sales, surpassing analysts’ expectations. Revlimid, despite a 5% decline in sales compared to last year, still exceeded revenue expectations. Other drugs like Reblozyl and Opdualag also saw revenue growth, while Abecma and Opdivo fell short of Wall Street’s expectations.
Overall, Bristol Myers Squibb’s first-quarter results showcase both positive and challenging aspects of the company’s performance. The strong sales of key drugs demonstrate the company’s ability to deliver successful treatments and generate revenue. However, the need to implement cost reduction measures highlights the pressures faced by pharmaceutical companies in a competitive market. Bristol Myers will need to continue prioritizing research and development investments to maintain its position as a leader in the industry and overcome potential revenue losses from patent expirations and increased competition.
