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    BMY
    Earnings call· Mar 2025(Q1 FY25)

    BRISTOL MYERS SQUIBB CO BMY

    Apr 24, 2025 Source

    Executive summary

    Bristol-Myers Squibb Q1 FY25 — Strong Growth Portfolio Performance and Raised Full-Year Guidance

    Bristol-Myers Squibb delivered a strong first quarter, driven by robust performance in its growth portfolio and effective cost management, leading to an increase in full-year revenue and EPS guidance. Despite setbacks in two pipeline studies, the company remains confident in its strategic priorities, including advancing its R&D pipeline and pursuing business development opportunities to drive long-term sustainable growth. The focus is on disciplined execution and navigating the complex global operating environment.

    Highlights

    5

    • Growth portfolio delivered double-digit sales growth, increasing approximately 18% in Q1 FY25.

    • Full-year revenue guidance increased to $45.8B-$46.8B, reflecting strong performance and a $500M favorable FX impact.

    • Non-GAAP EPS guidance midpoint raised by $0.15 per share to a range of $6.70-$7.00.

    • Cobenfy launch off to a solid start with $27M in sales and weekly TRx tracking ahead of all branded schizophrenia launch benchmarks.

    • Operating expenses were more than $500M lower compared to the same period last year due to strategic productivity initiatives.

    Concerns

    4

    • Camzyos ODYSSEY study in non-obstructive HCM did not meet its primary endpoint.

    • Cobenfy ARISE study in adjunctive schizophrenia did not meet its primary endpoint.

    • Eliquis global sales were down 3% in Q1 FY25, mainly due to the impact of Medicare Part D redesign in the U.S.

    • Legacy portfolio sales are expected to decline approximately 16%-18% for the year, primarily due to generic entries and Medicare Part D redesign.

    Guidance & targets

    16
    CategoryTargetConfidence
    Full-year revenue
    $45.8B-$46.8B
    high materiality
    High
    Full-year legacy portfolio decline
    Approximately 16%-18%
    medium materiality
    High
    Full-year Revlimid sales
    Top end of $2B-$2.5B
    medium materiality
    High
    Full-year gross margin
    Approximately 72%
    medium materiality
    High
    Full-year underlying operating expenses
    Approximately $16B
    medium materiality
    High
    Full-year operating margin
    Approximately 37%
    medium materiality
    High
    Annual OI&E income
    Approximately $100M
    low materiality
    High
    Full-year effective tax rate
    18%
    medium materiality
    High
    Full-year non-GAAP EPS
    $6.70-$7.00
    high materiality
    High
    Cobenfy Phase III studies initiation
    7 Phase III studies underway
    medium materiality
    High
    Iza-bren pivotal study enrollment
    Expected to begin enrollment
    medium materiality
    High
    Milvexian LIBREXIA atrial fibrillation trial readout
    On track to read out
    medium materiality
    High
    Milvexian ACN-SSP trial readout
    Look forward to readout
    medium materiality
    High
    RYZ101 Phase I study readout
    Expecting to see
    medium materiality
    High
    Iberdomide EXCALIBER study readout
    MRD negativity readout
    medium materiality
    High
    Mezigdomide EXCALIBER study readout
    Potentially in early 2026
    medium materiality
    Medium

    Segment performance

    8
    SegmentRevenueYoYQoQMargin
    Growth Portfolio
    Global sales increased, led by IO portfolio, Breyanzi, Reblozyl, and Camzyos.
    		—18%——
    Opdivo
    Global revenue up, driven primarily by volume growth.
    		—12%——
    Opdivo Qvantig
    Initial sales in Q1 FY25. US launch progressing well with early adoption across multiple tumor types.
    		$9M———
    Reblozyl
    Continued strength across first- and second-line MDS-associated anemia.
    US sales: increased due to increased use in first-line settingInternational sales: strong double-digit growth driven by demand across newly launched markets in Europe and Japan
    		—Double-digit——
    Breyanzi
    Key contributor to strong growth portfolio performance, driven by demand across all indications.
    US sales: more than doubledInternational sales: tripled
    		————
    Camzyos
    Sales benefited from strong global demand and new patient starts. Expected steady growth in 2025.
    Total prescriptions (3 months ended March 31): 19% increase
    		—Nearly doubled——
    Eliquis
    Global sales down mainly due to Medicare Part D redesign in the US. Expected to be stronger in H2 FY25.
    		—-3%——
    Cobenfy
    Solid start in its first full quarter on the market, driven primarily by demand. Weekly total prescriptions remained strong, tracking ahead of all branded schizophrenia launch benchmarks.
    		$27M———

    Operational metrics

    21
    Cash equivalents and marketable securities
    $12.1B
    As of March 31

    Financial position remains strong.

    Debt paydown target
    $10BRelative to March 31, 2024 balance
    Ongoing

    On track with plan.

    Dividend payment streak
    93rdConsecutive
    2025

    Rewarding shareholders through the dividend.

    Annual cost savings target
    $2B
    Annual

    From strategic productivity initiative.

    Cost savings delivered
    $1B
    Annual

    On track to deliver from strategic productivity initiative.

    Gross margin
    73%
    Q1 FY25

    Primarily due to product mix.

    Operating expenses reduction
    >$500MCompared to same period last year
    Q1 FY25

    Primarily reflecting results of strategic productivity initiative.

    Effective tax rate
    15.1%
    Q1 FY25

    Primarily driven by earnings mix.

    Diluted EPS
    $1.80
    Q1 FY25

    Non-GAAP.

    Opdivo Qvantig patient conversion target
    30%-40%
    Future

    Management continues to believe physicians will convert this percentage of patients to the new subcutaneous product.

    Cobenfy weekly total prescriptions (TRx)
    >1,600Tracking ahead of all branded schizophrenia launch benchmarks
    Weekly

    Strong early uptake since launch.

    Cobenfy Medicaid and Medicare access
    Virtually 100%
    Current

    Good progress achieving access across both channels.

    Cobenfy prescribing in second and third line
    Roughly 40%-50%
    Today

    Physicians are moving Cobenfy earlier in treatment.

    Camzyos patients prescribed
    >15,000
    Cumulative

    Reflects FDA's confidence in safety and efficacy.

    Camzyos echo monitoring frequency
    Once every 6 monthsReduced from every 12 weeks
    Maintenance phase

    For patients in the maintenance phase, simplifying processes and opening COE capacity.

    Multiple myeloma market treated in community
    >70%
    Current

    Highlights the need for small molecules and combinations in the community setting, as cell therapies are limited to academic centers.

    Major approvals in last 5 years
    43
    Last 5 years

    Speaks to the productivity of the organization, in the top quartile/90th percentile across the industry.

    New molecular entities target
    10+
    Future

    Forward-looking vision for pipeline.

    New indications target
    30+
    Future

    Forward-looking vision for pipeline.

    US biopharma R&D location
    >70%
    Current

    Highlights the importance of the US ecosystem for innovation.

    Cobenfy gross to net benefit
    $9M
    Q1 FY25

    Inclusive of $27M net sales, was a true-up for favorable gross to nets in Q4.

    Industry KPIs

    9
    MetricValueDetails
    Prescription volumeCobenfy: >1,600 TRx; Camzyos: 19% increase in total prescriptionsTRx; %
    EPS revenue guidanceRevenue: $45.8B-$46.8B; Non-GAAP EPS: $6.70-$7.00USD
    Pricing policy impact—
    Pipeline clinical milestones—
    Regulatory approvals filings—
    Price volume mix decomposition—
    Geographic regional revenue growth—
    Clinical trial efficacy safety data—
    Business development capacity deal appetite—

    Product announcements

    2
    ProductTypeDetails
    Cobenfylaunch
    Opdivo Qvantiglaunch

    Risks & headwinds

    8
    Camzyos ODYSSEY study failureQ1 FY25

    Did not meet primary endpoint

    Mitigation: Focus remains on existing obstructive HCM indication, which represents the vast majority of the market opportunity. Not expected to significantly impact peak sales.

    Cobenfy ARISE study failureQ1 FY25

    Did not meet primary endpoint

    Mitigation: Commercial strategy remains focused on monotherapy (70-80% of market). Management will complete full evaluation and engage with medical community and regulators. Not expected to meaningfully alter strategy or growth trajectory.

    Generic entriesQ1 FY25 and ongoing

    Impacted legacy portfolio performance

    Mitigation: Focus on maximizing growth portfolio and advancing pipeline to transition portfolio to long-term sustainable growth.

    Medicare Part D redesignQ1 FY25 and ongoing

    Eliquis global sales down 3% in Q1 FY25; impacted Sotyktu sales via higher commercial rebates

    Mitigation: Eliquis expected to be stronger in H2 FY25 due to Part D redesign and elimination of coverage gap. Sotyktu leveraging broader access to drive further demand growth.

    Global operating climate uncertaintyOngoing

    Tariffs, potential economic downturn, restructuring at the FDA and HHS

    Mitigation: Focus on building a strong and resilient company, executing strategy, pursuing efficiencies, and being laser-focused on execution.

    Potential pharmaceutical sector tariffsFuture

    Not accounted for in revised guidance

    Mitigation: Closely assessing, cross-functional team evaluating flexibility to move manufacturing. Engaging with administration to ensure thoughtful implementation.

    Differential between U.S. and ex-U.S. net pricingOngoing

    Not quantified

    Mitigation: Engaging directly with administration and pharma partners to leverage tools to get ex-U.S. countries to allocate more healthcare spending to innovative medicines.

    Complexity of U.S. healthcare systemOngoing

    $0.65 of every dollar spent on pharmaceutical products goes to middlemen

    Mitigation: Advocating to make the system less complex, ensure rebates improve patient out-of-pocket costs, fix egregious aspects of IRA (pill penalty, spillover risk), and address abuses in 340B program.

    What to watch in Q2 FY25

    5

    Cobenfy Alzheimer's psychosis Phase III readout

    H2 this year
    CurrentTrial ongoing
    TargetFirst look at data

    Why it matters

    This represents a significant unmet need and a potential new growth driver for Cobenfy, especially after the adjunctive schizophrenia trial setback.

    We expect several of these opportunities to come this year, such as the first look at one of the Phase III trials for Cobenfy in Alzheimer's disease psychosis, where there is significant unmet need.

    Q&A highlights

    6

    Asked about the company's US manufacturing footprint and ability to navigate potential tariffs, and the impact of the adjunctive trial results on Cobenfy's outlook.

    Management stated current tariffs are reflected in guidance, but pharma-specific tariffs are too early to comment on. They highlighted their significant US presence and ongoing investments. For Cobenfy, the adjunctive trial results do not meaningfully impact sales outlook as the focus remains on monotherapy, which accounts for 70-80% of the market, and early uptake is strong.

    “As Chris stated in his opening remarks, we don't expect these data to have a meaningful impact on Cobenfy sales, Chris. Recall, about 70% to 80% of patients are treated with monotherapy.”

    asked by Chris Schott · answered by Adam Lenkowsky

    2 min read6 chapters

    Detailed Narrative

    01

    Q1 Performance and Strategic Focus

    Bristol-Myers Squibb reported strong Q1 FY25 results, driven by an 18% increase in its growth portfolio sales, including key products like Opdivo, Breyanzi, Reblozyl, and Camzyos. The company is actively transitioning its portfolio for long-term sustainable growth, focusing on maximizing its growth portfolio, accelerating R&D, driving operational excellence, and strategically allocating capital. This execution led to an increase in full-year revenue and EPS guidance.

    02

    Pipeline Advancements and Recent Readouts

    The company advanced its pipeline with several regulatory approvals, including Opdivo plus Yervoy for 1L liver cancer and MSI-high colorectal cancer, Breyanzi in the EU for follicular lymphoma, and Camzyos in Japan with a favorable US label update. Milvexian's LIBREXIA atrial fibrillation trial completed enrollment, on track for a 2027 readout. While Camzyos ODYSSEY (non-obstructive HCM) and Cobenfy ARISE (adjunctive schizophrenia) studies did not meet primary endpoints, management stated these outcomes do not significantly alter their strategy or growth trajectory, with focus remaining on obstructive HCM for Camzyos and monotherapy for Cobenfy.

    03

    Cobenfy Launch and Future Indications

    Cobenfy, launched in October, achieved $27 million in sales in its first full quarter, with weekly total prescriptions tracking ahead of branded schizophrenia launch benchmarks. Physician and patient feedback is positive regarding its tolerability, efficacy, and cognitive benefits in monotherapy. The company plans to initiate seven new Phase III studies for Cobenfy by midyear across Alzheimer's agitation, Alzheimer's cognition impairment, and bipolar I, with the first Alzheimer's psychosis trial readout expected in H2 FY25.

    04

    Operational Efficiency and Financial Strength

    BMS is executing a strategic productivity initiative, aiming for $2 billion in annual cost savings by the end of 2027, with $1 billion expected by year-end 2025. This initiative contributed to over $500 million lower operating expenses year-over-year in Q1. The company maintains a strong financial position with $12.1 billion in cash and equivalents and generated $2 billion in cash flow from operations in Q1, supporting its capital allocation priorities.

    05

    Business Development and Capital Allocation

    Business development remains the top capital allocation priority, with a focus on strengthening core therapeutic areas and enhancing the company's growth profile. Management emphasized its financial flexibility to pursue opportunities that align with its scientific interests and financial rationale, without being constrained by internal data readouts. The company also plans to pay down $10 billion of debt by March 31, 2024, and continues its 93-year dividend payment streak.

    06

    Regulatory and Policy Environment

    BMS is actively engaging with the administration on tariff policies, advocating for thoughtful implementation that enhances the competitiveness of US companies, given its significant US manufacturing footprint. The company also addresses the complexities of the US healthcare system, including the role of middlemen and the impact of the IRA and 340B programs, while encouraging ex-US countries to increase healthcare spending on innovative medicines.

    AI-generated summary of the company’s earnings call. Not investment advice.