Bristol-Myers Squibb Co. unveiled an organizational revamp that aims to more clearly focus its resources for growth as the drugmaker also reported better-than-expected third-quarter results and raised its 2016 outlook.
In addition, the company authorized the repurchase of $3 billion of its shares and provided preliminary 2017 per-share earnings guidance that beat expectations.
Bristol-Myers said Wednesday that as part of its realignment, the company plans to focus more spending around its key brands and markets, make its research-and-development organization more agile, streamline certain operations and expand its abilities to manufacture biotech drugs. Bristol didn’t provide financial details except to say that excluding certain items, operating expenses through 2020 are expected to remain at roughly the same level as 2016.
The drugmaker was the first to bring to market a cancer immunotherapy, which aims to fight cancer by unshackling the body’s immune system. Its newest immunotherapy, Opdivo, also known as nivolumab, was first approved for sale in December 2014 for advanced melanoma and has since received approvals for other diseases. However, Bristol had a big setback in August as Opdivo wasn’t significantly better than chemotherapy in a study of patients with newly diagnosed lung cancer.
However, Bristol-Myers previously has said that it sees potential to use Opdivo in combination with its older immunotherapy, Yervoy, for newly diagnosed lung-cancer patients, with a study of such a combination drug continuing.
In the latest quarter, sales of Opdivo soared to $920 million from $305 million.
Sales of Yervoy, Bristol’s first skin-cancer immunotherapy drug, rose 19% to $285 million globally as U.S. sales surged to $222 million from $121 million. Domestic sales of Yervoy have benefited from the drug’s use in combination with Opdivo.
Over all, Bristol-Myers Squibb reported a profit of $1.2 billion, or 72 cents a share, up from $706 million, or 42 cents a share, a year earlier. Excluding certain items, adjusted per-share earnings rose to 77 cents from 39 cents. Revenue increased 21%, to $4.92 billion.
Analysts expected per-share profit of 65 cents and revenue of $4.79 billion.
Among other key drugs, sales of Eliquis soared 90%, to $884 million.
For 2016, the company raised its per-share earnings estimate to $2.80 to $2.90, from its previous estimate for per-share profit of $2.55 to $2.65.
Looking ahead to 2017, Bristol-Myers gave preliminary guidance for per-share earnings of $2.85 and $3.05, while analysts polled by Thomson Reuters expected per-share profit of $2.19.
By Tess Stynes
Source: Wall Street Journal
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