Bristol-Myers Squibb Co Earnings - Q1 2025 Analysis
Positives
- The company increased its top and bottom line guidance based on its performance in Q1.
- The Growth Portfolio delivered double-digit sales growth, driven by strength in key marketed products, including the I-O portfolio, Breyanzi, Reblozyl, and Camzyos.
- The company had a strong Q1 driven by solid execution across the business and continued focus on strategic priorities, maximizing the Growth Portfolio, accelerating the R&D pipeline, driving operational excellence, and strategically allocating capital.
- The company is on track to deliver $1 billion in savings this year and on track for $2 billion by 2027.
- The company's Growth Portfolio is delivering strong performance.
Q&A Highlights - Q1 2025
Analyst asked about the company's ability to navigate the dynamic tariff situation and the impact of tariffs on the pharma sector.
The company appreciates the administration's efforts to enhance US manufacturing, but it needs to be done in a thoughtful and deliberate way. The company is a significantly US-based company and has been investing in core infrastructure in the US for many years. The company hopes that the tariffs ultimately enhance the competitiveness of US companies like BMS. The company has provided guidance on the impact of tariffs on its business, but it is too early to provide more specific details.
Analyst asked about the impact of the adjunctive results of Cobenfy on the company's sales.
The company does not expect the adjunctive results to have a meaningful impact on Cobenfy sales. About 70-80% of patients are treated with monotherapy, and that is the most significant commercial opportunity. The company's focus is on moving Cobenfy earlier in treatment, and it has seen strong uptake in the market since launch with positive feedback from both physicians and patients. The company will continue to execute its plan for Cobenfy to come to foundational monotherapy treatment, and it has a clear opportunity to continue to drive significant growth.
Analyst asked about the company's approach to taking bets and the future pipeline's riskiness.
The company has been focused on driving strong execution, making the organization more efficient and agile, and delivering on the swath of new opportunities coming out of its mid- to late-stage pipeline. The company remains confident in its ability to deliver on the growth ambitions for the company, and the internal R&D pipeline continues to be a focus. The company has a strong financial position and strategic flexibility to continue to source innovation externally. The company has had 43 major approvals in the last five years, which speaks loudly of the productivity of the organization. The company has learned from the recent setbacks and is looking forward to 10-plus new molecular entities and 30-plus new indications by the end of the decade.
Analyst asked about the impact of the ARISE readout on BMS' confidence in the Alzheimer's psychosis readout and any additional trials they may be planning.
Samit Hirawat, Chief Medical Officer, explained that the ARISE data has no impact on BMS' confidence in the Alzheimer's psychosis readout. He mentioned that the disease is very different from Alzheimer's disease, and that the Alzheimer's disease psychosis plan and future-looking cognition impairment and agitation are based on data from xanomeline, which showed statistically significant benefits in behavioral patterns in patients with Alzheimer's disease. He also highlighted the longer duration of treatment of up to 12 weeks in Alzheimer's disease psychosis, which is beneficial in observing primary and secondary endpoints.
Analyst asked about BMS' stance on how the IRA drug prices could impact negotiations and the potential positive impact of an echo cardiac monitoring for Camzyos.
Christopher S. Boerner, CEO, explained that BMS is engaging directly with the administration and working with their pharma partners to support the administration's efforts to leverage tools to get ex-US countries to allocate more of their healthcare spending to innovative medicines. He mentioned that the US pricing environment is complex, with middlemen controlling what patients pay for medicines, and that rebates provided by the industry are not always used to improve patient outcomes. He also noted that BMS continues to be focused on addressing other aspects of healthcare, notably fixing some of the more egregious aspects of the IRA, such as the pill penalty and addressing spillover risk. Adam Lenkowsky, Chief Commercial Officer, added that the label change for Camzyos has been updated to reduce the frequency of echo monitoring for patients from every 12 weeks to once every six months in the maintenance phase, which will simplify processes for both patients and physicians, open up additional capacity at the COEs, and reduce the burden on patients' and physicians' time.
Analyst asked about the expectations for the Alzheimer's psychosis trial, specifically what a meaningful reduction in hallucinations and delusions would be.
Samit Hirawat, Chief Medical Officer, stated that they are not predefining what the real number needs to be to be clinically meaningful, and that all improvements are good. However, they have seen remarkable improvements in prior studies of xanomeline, not only on symptomatologies but also on cognition. They will continue to monitor the data and share more when the first trial reads out in the second half of the year.
Analyst asked about the gross-to-net question related to Camzyos.
Adam Lenkowsky, Executive Vice President and Chief Financial Officer, stated that they do not share specific discounting rates but have been disciplined in discretionary gross-to-net spend. The increase in gross-to-nets for the full year is due to the company now having 100% access virtually in both Medicaid and Medicare.
Analyst asked about how the company approaches M&A decisions, specifically in the context of internal success rates and waiting for sequencing of data cards to turn over.
Christopher S. Boerner, President, stated that the company is significantly based in the US and has been investing in core infrastructure related to R&D, technology, and CapEx. They plan to continue investing in these areas in the coming years. Business development has been a priority for the company for a number of years, and they will continue to allocate capital to this area. They do not think about business development in terms of the relationship between specific data readouts of their own internal programs, but rather as a way to source new science and innovation. They have the financial horsepower to execute quickly on business development deals that meet their criteria.
Analyst asked about the company's first-in-class position with Camzyos, specifically regarding the establishment of HCM centers and updated REMS in light of aficamten potentially coming to market this year.
The company has established a strong revenue base with Camzyos and expects continued growth from expanding its prescriber base. They are focused on increasing their depth of prescribing in large COEs and are making good progress expanding into community of cardiology accounts. The company does not see any meaningful clinical differentiation versus aficamten and has talked to hundreds of thought leaders who agree that aficamten's data appears undifferentiated. The company is prepared for when aficamten comes to market and maintains a consistent view that they will remain leaders in this space.
Analyst asked about the impact of nHCM results on HFpEF for MYK-224 and whether the company has done enough digging into the data.
The company is still digging into the data, but they do know that obstructive hypertrophic cardiomyopathy versus a non-obstructive hypertrophic cardiomyopathy is a suggestion of a differential disease because of the outflow tract obstruction in one versus the other. As it relates to HFpEF, the company thinks about the overall functionality of the heart and the impact on biomarkers like NT-proBNP and troponin T. However, the biomarkers have not translated into clinical benefit or outcome in nHCM, but they are conducting a large cohort of patients in the Phase 2b - Phase 2a study for MYK-224. The company is hopeful that the results of this study will provide more insight into the impact of nHCM results on HFpEF for MYK-224.
Analyst asked about the adoption of Qvantig and the market opportunity expansion.
The company is making good progress with Opdivo Qvantig and has seen positive feedback from physicians. The majority of the use has been in the community setting, and the company is focused on increasing breadth of prescribing in both community and academic settings. The company is also seeing physicians use Opdivo Qvantig across multiple tumor types, which is encouraging. The
Analyst asked about the potential for approval of the MRD negativity readout from the EXCALIBER study in the second-line multiple myeloma population and how it could impact the opportunity and utilization of iberdomide in combination with daratumumab and lenalidomide.
Christopher S. Boerner, the company's CEO, stated that the MRD negativity readout from the EXCALIBER study is an important study for the second-line multiple myeloma population, and the company will have to look at the totality of the data, including other endpoints, to determine the regulatory possibility of approval. He also mentioned that CAR T cells are moving up in lines of treatment but are still limited to academic centers, and small molecules and combinations are required in the community setting, where there is a large unmet medical need.
Analyst asked about the need for visibility on US corporate tax reform and how it would impact budgeting.
Christopher S. Boerner, the company's CEO, stated that there are multiple aspects of the policy environment that are in flux, and the company is monitoring each one of them. He mentioned that tax policy is critical, and a lower US corporate tax rate would positively impact investment in the United States in R&D.
Analyst asked about the progress of the PD-1/VEGF combination therapy in non-small cell lung cancer and what the company is watching for in terms of overall survival and safety.
Samit Hirawat, the company's Chief Medical Officer, stated that the data for the PD-1/VEGF combination therapy continues to evolve in the right direction, with a progression-free survival benefit seen in the additional Phase 3 study in China. He mentioned that the company will continue to watch out for the impact on overall survival and safety, and that the combination therapy has a large portfolio in non-small cell lung cancer.
Analyst asked about the company's priorities and how they remain consistent and clear, despite the uncertain times.
Christopher S. Boerner, the company's CEO, stated that the company's priorities remain consistent and clear, with a focus on delivering growth through its Growth Portfolio, aligning its cost structure with its revenue base, and generating attractive returns for shareholders. He mentioned that the company
