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Will New Drugs Help Bristol Myers (BMY) Combat Generic Pressure?

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Biotech bigwig Bristol Myers (BMY - Free Report) has had a decent run this year despite one of its top drugs Revlimid facing generic competition, which has adversely impacted the top line.

Revlimid was the largest contributor to the company’s revenues, and the entry of generics for the company had clouded the growth trajectory somewhat.

Bristol Myers seems to have more arrows in its quiver. As expected, the performance of blood thinner drug Eliquis and immuno-oncology drug Opdivo, along with encouraging pipeline progress, has maintained momentum.

But what has impressed the investors most is the recent string of new drug approvals, which paved the way for an incremental stream of revenues.  The FDA recently approved its experimental candidate deucravacitinib to treat adults with moderate-to-severe plaque psoriasis who are candidates for systemic therapy or phototherapy, under the brand name Sotyktu. Sotyktu is also under regulatory review by the European Medical Association and other health authorities worldwide.

The approval is based on results from the phase III POETYK PSO-1 and POETYK PSO-2 studies, demonstrating superior efficacy of once-daily Sotyktu over placebo and twice-daily Amgen’s (AMGN - Free Report) Otezla (apremilast) in 1,684 patients, aged 18 years and above, with moderate-to-severe plaque psoriasis. Bristol Myers added deucravacitinib to its pipeline when it acquired Celgene in 2019 and had to let go of Otezla.  In connection with the regulatory approval process for the transaction, Celgene sold the global rights to Otezla to Amgen. The risk should reap rewards with this new drug approval.

The FDA had earlier approved a new, first-in-class, fixed-dose combination of PD-1 inhibitor Opdivo (nivolumab) and relatlimab (novel LAG-3-blocking antibody). It is administered as a single intravenous infusion to treat adult and pediatric patients aged 12 years or older with unresectable or metastatic melanoma (a kind of skin cancer) under the brand name Opdualag.  The initial uptake f the drug has been encouraging so far. The drug was also approved in Europe.

Camzyos (mavacamten, 2.5 mg, 5 mg, 10 mg, 15 mg capsules) was also approved in the United States for treating adults with symptomatic New York Heart Association (NYHA) class II-III obstructive hypertrophic cardiomyopathy (obstructive HCM) to improve functional capacity and symptoms.

The uptake of the new product portfolio (primarily cell therapy products and Reblozyl) has also boosted sales.

Bristol Myers had earlier acquired Turning Point Therapeutics for $4.1 billion. The acquisition added Turning Point’s lead asset, repotrectinib, a next-generation, potential best-in-class tyrosine kinase inhibitor (TKI) targeting the ROS1 and NTRK oncogenic drivers of NSCLC and other advanced solid tumors. The deal should strengthen Bristol Myers’ position in the oncology space, particularly in the lucrative lung cancer arena.

Meanwhile, Eliquis has delivered a stellar performance so far in 2022, propelled by increases in share in the novel oral anticoagulant market.  Label expansion of Opdivo boosted sales driven by higher demand across multiple indications, including the Opdivo+Yervoy-based combinations for non-small cell lung cancer (NSCLC), Opdivo+Cabometyx combination for kidney cancer and Opdivo-based therapies for various gastric and esophageal cancers.

However, competition is stiff for Opdivo from the likes of Merck’s (MRK - Free Report) Keytruda. The drug, approved for various oncology indications, is the key driver for Merck.

The diversification of the portfolio should enable the company to combat these challenges.


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