Bristol-Myers Squibb Cuts Guidance on Cancer Drug Problems
January 26 2017 - 7:30AM
Dow Jones News
By Anne Steele
Bristol-Myers Squibb Co. slashed its guidance for the year as
the drugmaker contends with dimmed prospects for its top cancer
drug after major setbacks during the final quarter of the year.
For 2017, the company now expects adjusted earnings of $2.70 to
$2.90 a share, down from its previous guidance of $2.85 to
$3.05.
Bristol pioneered cancer immunotherapy, treatment that aims to
fight cancer by harnessing the body's immune system, but it has
been losing ground to competitors in recent months, including Merck
& Co.'s Keytruda.
After Bristol announced in August that its immunotherapy Opdivo
failed to meet the main goal of a critical study exploring the
drug's first-line use in advanced lung cancer patients, the company
sought to convince investors it still had bright prospects treating
first-line lung cancer patients by combining Opdivo with its other
immunotherapy Yervoy, which is under study.
But last week, Bristol said it won't pursue speedy U.S.
regulatory approval to market that combination as a first-line
treatment for lung cancer. That announcement fed fears the company
is losing ground in the race for this all-important patient
group.
During the fourth quarter, Opdivo sales rose to $1.3 billion, up
from $475 million during the period a year earlier. Yervoy sales
edged 0.4% lower to $264 million world-wide. Revenue from another
key Bristol product, the blood thinner Eliquis, jumped 57% to $948
million globally.
In all for the December period, Bristol-Myers Squibb posted
earnings of $894 million, or 53 cents a share, compared with a loss
of $197 million, or 12 cents a share, a year earlier. The 2015
results included after-tax charges of 24 cents a share from the
Five Prime Therapeutics Inc. and Cardioxyl Pharmaceuticals Inc.
business development transactions and 8 cents a share for the
transfer of the Erbitux business in North America to Eli Lilly
& Co.
Excluding certain items, adjusted earnings rose to 63 cents a
share from 38 cents. Revenue surged 22%, to $5.24 billion.
Analysts polled by Thomson Reuters had predicted earnings of 67
cents a share on $5.13 billion in revenue.
In the previous quarter, Bristol said it had begun a
reorganization to streamline certain operations, such as its supply
chain for pills. The company provided no update on the
reorganization in Thursday's report.
Also last week, Merck agreed to pay $625 million plus royalties
on Keytruda sales to Bristol and Ono Pharmaceutical Co. to settle a
suit alleging the cancer drug violates their patent for
immunotherapy.
Bristol and Ono filed suit in federal court in Delaware in 2014,
the same day that Merck received U.S. Food and Drug Administration
approval to market Keytruda as a treatment for the deadly skin
cancer melanoma.
Bristol and Ono, who discovered and developed the PD-1 antibody
Opdivo, had asserted in litigation that Merck's sale of Keytruda
infringed the companies' patents relating to the use of PD-1
antibodies to treat cancer in the U.S., Europe, Australia and
Japan.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
January 26, 2017 07:15 ET (12:15 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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