Bristol-Myers Squibb Plans Organizational Revamp, Unveils $3 Billion Share Buyback
October 27 2016 - 8:09AM
Dow Jones News
By Tess Stynes
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.
Write to Tess Stynes at tess.stynes@wsj.com
(END) Dow Jones Newswires
October 27, 2016 07:54 ET (11:54 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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