Bristol-Myers Squibb(US:BMY)2023-10-26 15:36Financial Data and Key Metrics Changes - Total company sales in Q3 2023 were $11 billion, driven by growth in in-line and new product portfolios, offset by a decline in Revlimid sales [21] - Non-GAAP EPS guidance for the year has been increased, with the midpoint revised to $7.50 to $7.65 [33] - Gross margin was positively impacted by product mix, with a reduction in the effective tax rate due to changes in R&D expense deductibility [31] Business Line Data and Key Metrics Changes - New product portfolio generated $928 million in revenue during the quarter, with expectations to deliver approximately $3.5 billion for the full year 2023 [22] - Opdivo sales grew 11% globally, with U.S. sales up 9%, driven by demand and a reversal of unfavorable buying patterns [23] - Eliquis generated $2.7 billion in revenue, with U.S. sales growing 4% year-over-year [25] Market Data and Key Metrics Changes - Opdualag revenue nearly doubled, capturing a market share of approximately 25% in first-line melanoma [24] - Zeposia sales were $123 million, up 75% compared to the prior year, driven by demand in multiple sclerosis [30] - Sotyktu sales were $66 million, with a significant clinical supply purchase contributing to the revenue [30] Company Strategy and Development Direction - The company is focused on sustainable long-term growth through commercial execution, R&D leadership, and strategic business development [8] - The planned acquisition of Mirati is expected to strengthen and diversify the oncology portfolio [18] - The company aims to achieve greater than $10 billion in sales from new products by 2026, a year later than previously communicated [33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term potential of the new product portfolio, despite some products taking longer to gain traction [39] - The company is focused on executing commercial strategies and advancing its pipeline to drive growth into the back half of the decade [19] - Management acknowledged challenges with certain products but emphasized the importance of maintaining focus on long-term growth [40] Other Important Information - The company has a strong cash flow generation, with approximately $4.8 billion from operations in Q3 and over $8 billion in cash and marketable securities [32] - The company executed $4 billion in accelerated share repurchase (ASR) during the quarter [32] Q&A Session Summary Question: Concerns about lowering 2025 targets and long-term peak sales potential - Management reassured that the long-term potential for the new product portfolio remains strong, with timing changes acknowledged for certain products [39][40] Question: Incremental benefit of sub-cu Optivo and strategic importance - Management highlighted that sub-cu formulations aim to improve patient experience and could extend the franchise into the early 2030s [44] Question: Confirmation of no contribution from Mirati in medium-term outlook - Management confirmed that long-term guidance for the new product portfolio does not include Mirati sales, with expected dilution of about $0.35 next year [46] Question: Clarification on 37% margin guidance - Management indicated that the 37% margin guidance is a floor for 2025, with further guidance for 2024 to be provided in the next earnings call [49] Question: Launch reboot strategy for underperforming drugs - Management discussed strategies for products like Sotyktu and Camzyos, emphasizing strong fundamentals and the need for time to reach peak sales [60][61]