Bristol-Myers Squibb Company has reported results for the first quarter of 2019 which were highlighted by strong demand for Opdivo (nivolumab) and Eliquis (apixaban) and a robust operating performance across the portfolio.
“We had a very good first quarter during which the company remained focused on delivering strong sales growth of our prioritized brands and continuing to advance the science in our disease areas of focus,” said Giovanni Caforio, M.D., chairman and chief executive officer, Bristol-Myers Squibb. “We also achieved approval from Bristol-Myers Squibb and Celgene shareholders to move forward with the acquisition. Looking forward, we are focused on our integration planning with Celgene and creating a leading biopharma company, with potential first-in- and best-in-class medicines, to address the unmet needs of our patients and create long-term substantial growth.”
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First Quarter
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$ amounts in millions, except per share amounts
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2019
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2018
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Change
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Total Revenues
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$5,920
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$5,193
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14%
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GAAP Diluted EPS
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1.04
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0.91
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14%
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Non-GAAP Diluted EPS
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1.10
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0.94
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17%
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FIRST QUARTER FINANCIAL RESULTS
- Bristol-Myers Squibb posted first quarter 2019 revenues of $5.9 billion, an increase of 14% compared to the same period a year ago. Revenues increased 18% when adjusted for foreign exchange impact.
- U.S. revenues increased 24% to $3.4 billion in the quarter compared to the same period a year ago. International revenues increased 2%. When adjusted for foreign exchange impact, international revenues increased 10%.
- Gross margin as a percentage of revenue decreased from 69.5% to 68.9% in the quarter primarily due to product mix and higher excise tax, partially offset by favorable foreign exchange.
- Marketing, selling and administrative expenses increased 3% to $1.0 billion in the quarter.
- Research and development expenses increased 8% to $1.4 billion in the quarter.
- The effective tax rate was 13.3% in the quarter, compared to 16.0% in the first quarter last year.
- The company reported net earnings attributable to Bristol-Myers Squibb of $1.7 billion, or $1.04 per share, in the first quarter, compared to net earnings of $1.5 billion, or $0.91 per share, for the same period in 2018. The results for the first quarter of 2019 include $187 million of Celgene-related acquisition and integration expenses.
- The company reported non-GAAP net earnings attributable to Bristol-Myers Squibb of $1.8 billion, or $1.10 per share, in the first quarter, compared to net earnings of $1.5 billion, or $0.94 per share, for the same period in 2018. An overview of specified items is discussed under the “Use of Non-GAAP Financial Information” section.
- Cash, cash equivalents and marketable securities were $10.0 billion, with a net cash position of $4.0 billion, as of March 31, 2019.
ACQUISITION OF CELGENE CORPORATION
In April, the company announced its shareholders voted to approve the company’s pending acquisition of Celgene Corporation. The company continues to expect to close the acquisition in the third quarter.
FIRST QUARTER PRODUCT AND PIPELINE UPDATE
Product Sales/Business Highlights
Global revenues for the first quarter of 2019, compared to the first quarter of 2018, were driven by:
Eliquis, which grew by $419 million or 28% increase
Opdivo, which grew by $290 million or 19% increase
Yervoy, which grew by $135 million or 54% increase
Orencia, which grew by 8%
Sprycel, which grew by 5%
Opdivo
Clinical
- The company today announced topline results from the Phase 2 CheckMate -714 trial evaluating Opdivo versus Opdivo plus Yervoy (ipilimumab) in patients with recurrent or metastatic squamous cell carcinoma of the head and neck. The study did not meet its primary endpoints.
- In April, at the American Association for Cancer Research Annual Meeting 2019, the company announced four-year survival results from pooled analyses of four studies (CheckMate -017, -057, -063 and -003) in patients with previously-treated advanced non-small cell lung cancer who were treated with Opdivo.
- In February, at the American Society of Clinical Oncology 2019 Genitourinary Cancers Symposium, the company announced new data and analysis from studies evaluating Opdivo plus Yervoy:
- CheckMate -650: Results from the Phase 2 study evaluating Opdivo in combination with Yervoy in patients with metastatic castration-resistant prostate cancer.
- CheckMate -214: Results from the Phase 3 study evaluating Opdivo plus low-dose Yervoy in patients with previously untreated advanced or metastatic renal cell carcinoma.
Eliquis
Clinical
- In March, at the American College of Cardiology’s 68th Annual Scientific Session 2019, the company and its alliance partner Pfizer announced results from the Phase 4 AUGUSTUS trial evaluating Eliquis versus vitamin K antagonists in patients with non-valvular atrial fibrillation and recent acute coronary syndrome and/or undergoing percutaneous coronary intervention. The data was simultaneously published in the New England Journal of Medicine.
Sprycel
Regulatory
- In February, the company announced the European Commission approved Sprycel (dasatinib) in combination with chemotherapy for the treatment of pediatric patients with newly diagnosed Philadelphia chromosome-positive acute lymphoblastic leukemia.
2019 FINANCIAL GUIDANCE
Bristol-Myers Squibb is increasing its 2019 GAAP EPS guidance range to $3.84 - $3.94 and confirming its non-GAAP EPS guidance range of $4.10 - $4.20. Both GAAP and non-GAAP guidance assume current exchange rates. Key 2019 GAAP and non-GAAP line-item guidance assumptions are:
- Worldwide revenues increasing in the mid-single digits.
- Gross margin as a percentage of revenue to be approximately 70% for both GAAP and non-GAAP.
- Marketing, selling and administrative expenses decreasing in the mid-single digit range for both GAAP and non-GAAP.
- Research and development expenses decreasing in the high-single digits for GAAP and increasing in the high-single digits for non-GAAP.
- An effective tax rate of approximately 14% for GAAP and approximately 16% for non-GAAP.
The financial guidance for 2019 excludes the impact of any potential future strategic acquisitions and divestitures, including any impact of the Celgene acquisition other than expenses incurred in the first quarter of 2019, and any specified items that have not yet been identified and quantified. The non-GAAP 2019 guidance also excludes other specified items as discussed under “Use of Non-GAAP Financial Information.” Details reconciling adjusted non-GAAP amounts with the amounts reflecting specified items are provided in supplemental materials available on the company’s website.
Guidance inclusive of the Celgene acquisition will be provided after the close of the transaction. The company’s previously announced sale of the UPSA consumer health business to Taisho Pharmaceutical Holdings Co., Ltd. for $1.6 billion is anticipated to be completed in July 2019.
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