Sunday, October 17, 2021

JPM 21: Dealmaking still a ‘top priority’ at Bristol Myers as CEO eyes midsize buys

Even after shelling out $74 billion for Celgene and $13.1 billion for MyoKardia, Bristol Myers Squibb is not done with dealmaking.

The New York pharma still has “significant financial flexibility” to pull off deals, Bristol Myers CEO Giovanni Caforio said at the J.P. Morgan Healthcare Conference Monday, calling business development a “top priority” at the company.

Specifically, “We will continue to look for midsize bolt-on deals that further strengthen our object to grow the company into the second half of the decade,” he said. As of the third quarter, Bristol Myers had about $22 billion in cash, and it expects to have $45 billion to $50 billion in free cash flow around 2021 to 2023.

New Planning Product Summit

Tailored Product Commercialization Strategies

Join the New Product Planning Summit to discuss tools and resources to optimize early decision-making, collaborate with cross-functional partners to guide product development, and leverage key insights to tailor a product plan to ensure the successful launch of a new product.

The acquisition of Celgene, though costly, also gave Bristol Myers such big cash generators such as Revlimid, which chalked up 10% year-over-year growth in the third quarter to $3.03 billion in sales. The company just dialed up its cost-cutting goal as result of the buyout to $3 billion from the previous $2.5 billion.

Another important drug for Bristol Myers is Opdivo. The PD-1 inhibitor’s rollout in first-line non-small cell lung cancer is going well, while the disease’s second-line setting is “sort of behind us” in terms of new patient starts, Caforio said. He also pointed to bladder cancer, first-line kidney cancer and the broad post-surgery adjuvant setting as further opportunity for longer-term Opdivo growth.

The company is now focused on reducing debt to further strengthen its ability to invest in striking deals and increasing shareholder return, Caforio said. “We also plan to strengthen our balance sheet to support capacity for additional business development by accelerating repayment $4 billion of debt into this year,” he said.

To pay down debt, it also needs new drugs to churn out revenue.

Caforio pointed to a nonrisk-adjusted revenue potential of more than $20 billion In its launch portfolio. These could come from anemia drug Reblozyl, MyoKardia’s heart drug mavacamten, TYK2 inhibitor deucravacitinib for psoriasis and other autoimmune diseases, and its cell therapies inherited from Celgene, all of which could hit at least $4 billion in peak sales by Caforio’s estimate.

The last piece of the growth picture recently suffered a setback, though. The FDA didn’t hand out a decision on CD19-targeted CAR-T candidate liso-cel by the end of 2020, despite repeated previous delays in its go-to-market timeline.  

“I am confident in the approval of liso-cel, and I’m very confident in the profile of liso-cel as a differentiated CAR-T,” he said.

The FDA’s non-decision nixed a $9-apiece Celgene deal sweetener called a contingent value right, too. That takes Bristol Myers off the hook for about $6.4 billion in additional payments to holders of that CVR, initially issued to Celgene shareholders as part of that buyout. So the company has redirected some of that money into an additional $2 billion in share buyback.

Source link

Latest Articles

Widely used chemical linked to 1,00,000 US deaths per year: Study

NEW YORK: Daily exposure to phthalates, a group of chemicals used in everything from plastic containers to makeup, may lead to approximately 100,000 deaths...

Foods to Reduce Inflammation and Strengthen the Immune System

Did you know that you can greatly reduce inflammation and boost your immune system by simply incorporating more anti-inflammatory foods and beverages into your...

Personal Selling

INTRODUCTION Early sellers and traders were not held in high esteem. The Roman word for salesman meant ‘Cheater’ and...

Building Muscle on a Vegan Diet

There are a lot of  misconceptions surrounding veganism. The notion that those who practice it are lacking in protein and therefore muscles is the...

Electrodes in brain new hope for severe cases of epilepsy

Neurosurgeons at All India Institute of Medical Sciences have devised a new technique for operating on children suffering from a severe form of epilepsy...