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Bristol-Myers Squibb Company (BMY): Driving Sustainable Growth Through Focused Execution and Pipeline Advancement
Published on September 24, 2024 | Ticker: BMY

Bristol-Myers Squibb Company (BMY) has delivered a strong performance in the second quarter of 2024, demonstrating its ability to execute on its strategic priorities and drive sustainable growth. The company reported annual net income of $8,025,000,000, annual revenue of $45,006,000,000, annual operating cash flow of $13,860,000,000, and annual free cash flow of $12,651,000,000.

Business Overview

In the second quarter of 2024, the company's total revenues increased by 9% year-over-year, driven by the strong performance of its Growth Portfolio, which grew 18% excluding the impact of foreign exchange. This portfolio now represents 46% of the company's total business, reflecting the successful execution of its strategy to focus on transformational medicines where it has a competitive advantage.

Hematology-Oncology Franchise

The company's hematology-oncology franchise continued to deliver impressive results, with Opdivo (nivolumab) and the Opdivo + Yervoy (ipilimumab) regimen maintaining their strong positions in multiple indications. Opdivo's U.S. revenues increased 15% in the second quarter, primarily due to higher average net selling prices and higher demand, while international revenues grew 6% despite the impact of foreign exchange. The company is also making progress with its cell therapy portfolio, with Breyanzi (lisocabtagene maraleucel) and Abecma (idecabtagene vicleucel) delivering strong growth.

Cardiovascular Segment

In the cardiovascular segment, Eliquis (apixaban) remained the market leader, with global sales exceeding $3 billion. The U.S. revenues for Eliquis increased 10% in the second quarter, driven by higher demand and market share gains, although international revenues decreased 2% due to foreign exchange impacts.

Immunology Portfolio

The company's immunology portfolio also saw some positive developments, with Camzyos (mavacamten) more than tripling its sales compared to the prior year. The U.S. demand for Camzyos increased, with the number of commercially dispensed patients growing by approximately 1,300 since the first quarter, reaching almost 6,900 patients on commercial drug.

However, the performance of Sotyktu (deucravacitinib) in the immunology segment has been slower than expected, with the company acknowledging the competitive nature of the market and the challenges in securing favorable access. The company is focused on improving Sotyktu's performance by continuing to work on expanding its access and commercial positioning.

Outlook

Looking ahead, Bristol-Myers Squibb is confident in its ability to deliver top-tier growth and maximize long-term value. The company has raised its full-year revenue guidance to the upper end of its previous range, reflecting the strength of its Growth Portfolio and better-than-expected sales of Revlimid (lenalidomide). Additionally, the company has raised its full-year non-GAAP EPS guidance to between $0.60 and $0.90.

Recent Developments

The company's pipeline continues to advance, with several key milestones expected in the coming months and years. This includes the anticipated FDA approval of KarXT (xanomeline-trospium) in late September 2024, which the company is actively preparing to launch. KarXT is a novel antipsychotic with the potential to address the significant unmet need in the treatment of schizophrenia.

Furthermore, the company is making progress in its immunology and cardiovascular pipelines, with data readouts expected for CD19 NEX-T, a potentially transformational therapy, as well as for Sotyktu in psoriatic arthritis and Milvexian, a promising oral factor 11A inhibitor for the treatment of atrial fibrillation.

Geographic Diversification

Bristol-Myers Squibb's geographic diversification is also evident, with the company reporting that no single country outside the U.S. contributed more than 10% of total revenues during the six months ended June 30, 2024. The company's international revenues decreased 1% in the second quarter and year-to-date, primarily due to foreign exchange impacts and lower demand for the Legacy Portfolio, which was partially offset by higher demand for the Growth Portfolio.

Revenue Breakdown

In terms of revenue breakdown, the company's Growth Portfolio, which includes products such as Opdivo, Orencia (abatacept), Yervoy, Reblozyl (luspatercept-aamt), Opdualag (nivolumab and relatlimab-rmbw), Abecma, Zeposia (ozanimod), Breyanzi, Camzyos, Sotyktu, Augtyro (repotrectinib), and Krazati (adagrasib), grew 18% in the second quarter and 13% year-to-date, excluding the impact of foreign exchange. The Legacy Portfolio, which includes Eliquis, Revlimid, Pomalyst/Imnovid (pomalidomide), Sprycel (dasatinib), and Abraxane (paclitaxel albumin-bound particles for injectable suspension), grew 2% in the second quarter and year-to-date.

Financials

The company's financial position remains strong, with approximately $7 billion in cash, cash equivalents, and marketable debt securities as of June 30, 2024. During the second quarter, the company reduced its total debt position by $3.1 billion, including the repayment of $2.7 billion in commercial paper and $400 million in long-term debt, consistent with its plan to pay down approximately $10 billion of debt over the next two years.

Bristol-Myers Squibb's focus on operational excellence and financial discipline is evident in its improved gross margins and steady progress against its $1.5 billion cost savings program. The company plans to reinvest these cost savings into higher growth opportunities to drive greater patient impact and accelerate its sales growth in the second half of the decade.

Conclusion

In conclusion, Bristol-Myers Squibb has delivered a strong performance in the second quarter of 2024, demonstrating its ability to execute on its strategic priorities and drive sustainable growth. The company's focus on transformational medicines, operational excellence, and strategic capital allocation positions it well to continue delivering value to its shareholders and patients in the years to come.

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