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Bristol-Myers Squibb Company (BMY - Free Report) reported decent results for the third quarter of 2022. The company reported earnings of $1.99 per share, which beat the Zacks Consensus Estimate of $1.83 and increased from $1.93 reported in the year-ago quarter.
Total revenues of $11.2 billion surpassed the Zacks Consensus Estimate of $11 billion but decreased 3% from the year-ago period due to generic competition for multiple myeloma (MM) drug, Revlimid and foreign exchange impacts, partially offset by in-line products (primarily Eliquis and Opdivo) and new product portfolios (primarily Opdualag, Abecma and Reblozyl). Our estimate for total revenues was $11.2 billion.
However, shares are down in pre-market trading.
The company’s shares have gained 16.7% in the year so far against the industry's decline of 25.4%.
Image Source: Zacks Investment Research
Quarterly Details
Revenues from in-line and new product portfolios increased 8% (13% when adjusted for foreign exchange impacts) to $8.6 billion. Revenues increased 9% to $7.9 billion in the United States. However, revenues were down 24% outside the country.
Total In-Line products revenues came in at $8 billion, up 5% from the year-ago quarter, driven by growth in demand. The Zacks Consensus Estimate and our estimate for the same was $8.4 billion. Within this segment, Eliquis drove growth for the company as sales increased 10% to $2.6 billion. Revenues in international markets were impacted by foreign exchange impacts. We note that Bristol-Myers has a collaboration agreement with Pfizer (PFE - Free Report) for Eliquis.
The companies collaborated in 2007. Pfizer funds between 50% and 60% of all development costs, depending on the study. Profits and losses are shared equally on a global basis, except in certain countries where Pfizer commercializes Eliquis and pays BMY a sales-based fee.
Sales of the immuno-oncology drug Opdivo, approved for multiple cancer indications, were up 7% year over year to $2 billion. Sales matched our estimate. The Zacks Consensus Estimate was pegged at $2.1 billion. The label expansion of the drug boosted sales, driven by higher demand across multiple indications, including the Opdivo+Yervoy-based combinations for non-small cell lung cancer (NSCLC), the Opdivo+Cabometyx combination for kidney cancer and the Opdivo-based therapies for various gastric and esophageal cancers.
Another MM drug, Pomalyst, generated sales of $886 million, up 4% year over year.
Sales of the rheumatoid arthritis drug, Orencia, grew 1% to $883 million.
The leukemia drug, Sprycel, raked in sales of $560 million, up 2% year over year.
Melanoma drug, Yervoy contributed $523 million to the top line, up 2%.
New product portfolio revenues grew 61% to $553 million, driven by higher demand for Reblozyl (up 19% to $190 million), Abecma ($107 million), and Opdualag ($84 million).
However, Revlimid revenues declined 28% to $2.4 billion from the year-ago quarter due to a loss of exclusivity, primarily in international markets. Our estimate for the same was $2.1 billion. Abraxane revenues declined 33% due to the entry of authorized generics.
Adjusted research and development expenses decreased 5% to $2.3 billion in the quarter. Adjusted marketing, selling and administrative expenses increased 4%. Gross margin fell to 79.8% from 81.1% in the quarter.
2022 Guidance
Bristol-Myers continues to expect 2022 earnings of $7.44-$7.74. Revenues are anticipated to be around $46 billion. The Zacks Consensus Estimate for earnings is pegged at $7.52 per share on revenues of $45.79 billion. Revlimid sales are expected to be $9-$9.5 billion.
Bristol Myers Squibb Company Price, Consensus and EPS Surprise
The FDA accepted the company’s supplemental new drug application for Camzyos for an expanded indication for the treatment of adults with symptomatic New York Heart Association class II-III obstructive hypertrophic cardiomyopathy to improve functional capacity, improve symptoms and reduce the need for septal reduction therapy. The regulatory body has assigned a target action date of Jun 16, 2023.
The European Commission approved the fixed-dose combination of Opdualag for the first-line treatment of advanced (unresectable or metastatic) melanoma in adults and adolescents 12 years of age and older with tumor cell PD-L1 expression < 1%.
The FDA approved Sotyktu, a first-in-class, oral, selective, allosteric tyrosine kinase 2 inhibitor, for the treatment of adults with moderate-to-severe plaque psoriasis who are candidates for systemic therapy or phototherapy.
Our Take
Bristol-Myers beat third-quarter estimates for earnings and revenues. Sales however declined year over year due to generic competition for Revlimid. Nevertheless, the approval of new drugs adds a new stream of revenues, which should boost growth in the coming quarters. Pipeline progress has been impressive and strategic collaborations will further expand the portfolio.
Loss estimates for Puma have narrowed to 6 cents from 16 cents over the past 60 days. Puma surpassed estimates in three of the trailing four quarters and missed in the other one, the average being 201.37%.
Earnings estimates for Dynavax have increased to $1.74 from $1.15 for 2022 over the past 90 days. Earnings of Dynavax surpassed estimates in two of the trailing four quarters.
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Bristol-Myers (BMY) Q3 Earnings Beat, Sales Decline Y/Y
Bristol-Myers Squibb Company (BMY - Free Report) reported decent results for the third quarter of 2022. The company reported earnings of $1.99 per share, which beat the Zacks Consensus Estimate of $1.83 and increased from $1.93 reported in the year-ago quarter.
Total revenues of $11.2 billion surpassed the Zacks Consensus Estimate of $11 billion but decreased 3% from the year-ago period due to generic competition for multiple myeloma (MM) drug, Revlimid and foreign exchange impacts, partially offset by in-line products (primarily Eliquis and Opdivo) and new product portfolios (primarily Opdualag, Abecma and Reblozyl). Our estimate for total revenues was $11.2 billion.
However, shares are down in pre-market trading.
The company’s shares have gained 16.7% in the year so far against the industry's decline of 25.4%.
Image Source: Zacks Investment Research
Quarterly Details
Revenues from in-line and new product portfolios increased 8% (13% when adjusted for foreign exchange impacts) to $8.6 billion. Revenues increased 9% to $7.9 billion in the United States. However, revenues were down 24% outside the country.
Total In-Line products revenues came in at $8 billion, up 5% from the year-ago quarter, driven by growth in demand. The Zacks Consensus Estimate and our estimate for the same was $8.4 billion. Within this segment, Eliquis drove growth for the company as sales increased 10% to $2.6 billion. Revenues in international markets were impacted by foreign exchange impacts. We note that Bristol-Myers has a collaboration agreement with Pfizer (PFE - Free Report) for Eliquis.
The companies collaborated in 2007. Pfizer funds between 50% and 60% of all development costs, depending on the study. Profits and losses are shared equally on a global basis, except in certain countries where Pfizer commercializes Eliquis and pays BMY a sales-based fee.
Sales of the immuno-oncology drug Opdivo, approved for multiple cancer indications, were up 7% year over year to $2 billion. Sales matched our estimate. The Zacks Consensus Estimate was pegged at $2.1 billion. The label expansion of the drug boosted sales, driven by higher demand across multiple indications, including the Opdivo+Yervoy-based combinations for non-small cell lung cancer (NSCLC), the Opdivo+Cabometyx combination for kidney cancer and the Opdivo-based therapies for various gastric and esophageal cancers.
Another MM drug, Pomalyst, generated sales of $886 million, up 4% year over year.
Sales of the rheumatoid arthritis drug, Orencia, grew 1% to $883 million.
The leukemia drug, Sprycel, raked in sales of $560 million, up 2% year over year.
Melanoma drug, Yervoy contributed $523 million to the top line, up 2%.
New product portfolio revenues grew 61% to $553 million, driven by higher demand for Reblozyl (up 19% to $190 million), Abecma ($107 million), and Opdualag ($84 million).
However, Revlimid revenues declined 28% to $2.4 billion from the year-ago quarter due to a loss of exclusivity, primarily in international markets. Our estimate for the same was $2.1 billion. Abraxane revenues declined 33% due to the entry of authorized generics.
Adjusted research and development expenses decreased 5% to $2.3 billion in the quarter. Adjusted marketing, selling and administrative expenses increased 4%. Gross margin fell to 79.8% from 81.1% in the quarter.
2022 Guidance
Bristol-Myers continues to expect 2022 earnings of $7.44-$7.74. Revenues are anticipated to be around $46 billion. The Zacks Consensus Estimate for earnings is pegged at $7.52 per share on revenues of $45.79 billion. Revlimid sales are expected to be $9-$9.5 billion.
Bristol Myers Squibb Company Price, Consensus and EPS Surprise
Bristol Myers Squibb Company price-consensus-eps-surprise-chart | Bristol Myers Squibb Company Quote
Other Updates
The FDA accepted the company’s supplemental new drug application for Camzyos for an expanded indication for the treatment of adults with symptomatic New York Heart Association class II-III obstructive hypertrophic cardiomyopathy to improve functional capacity, improve symptoms and reduce the need for septal reduction therapy. The regulatory body has assigned a target action date of Jun 16, 2023.
The European Commission approved the fixed-dose combination of Opdualag for the first-line treatment of advanced (unresectable or metastatic) melanoma in adults and adolescents 12 years of age and older with tumor cell PD-L1 expression < 1%.
The FDA approved Sotyktu, a first-in-class, oral, selective, allosteric tyrosine kinase 2 inhibitor, for the treatment of adults with moderate-to-severe plaque psoriasis who are candidates for systemic therapy or phototherapy.
Our Take
Bristol-Myers beat third-quarter estimates for earnings and revenues. Sales however declined year over year due to generic competition for Revlimid. Nevertheless, the approval of new drugs adds a new stream of revenues, which should boost growth in the coming quarters. Pipeline progress has been impressive and strategic collaborations will further expand the portfolio.
Bristol-Myers currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the healthcare sector are Puma Biotechnology (PBYI - Free Report) and Dynavax (DVAX - Free Report) ). Both the stocks carry a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Loss estimates for Puma have narrowed to 6 cents from 16 cents over the past 60 days. Puma surpassed estimates in three of the trailing four quarters and missed in the other one, the average being 201.37%.
Earnings estimates for Dynavax have increased to $1.74 from $1.15 for 2022 over the past 90 days. Earnings of Dynavax surpassed estimates in two of the trailing four quarters.