10-Q: Bristol-Myers Squibb Reports Q1 2025 Earnings, Revenue Declines Amid Growth Portfolio Expansion

• Bristol-Myers Squibb (BMS) reported its Q1 2025 financial results, showing a decrease in total revenues by 6% to $11.201 billion compared to $11.865 billion in Q1 2024.
• The decline in revenue was attributed to the impact of generic erosion on legacy products like Revlimid, Sprycel, and Abraxane, as well as the redesign of the U.S. Medicare Part D program affecting Eliquis.
• Diluted earnings per share (EPS) under GAAP increased to $1.20 from $(5.89), primarily due to one-time charges in 2024 related to the Karuna asset acquisition and SystImmune collaboration.
• Excluding specified items, non-GAAP EPS increased by $6.20, mainly due to the absence of Acquired IPRD charges in 2025 and lower revenue.
• The Growth Portfolio, including products like Opdivo, Orencia, and Reblozyl, saw a revenue increase of 16%, while the Legacy Portfolio experienced a 20% decline.
• Research and development expenses decreased by $438 million, primarily due to acquisition-related expenses in 2024 and strategic productivity initiatives in 2025.
• BMS is currently under examination by a number of tax authorities that proposed or are considering proposing material adjustments to tax positions for issues such as transfer pricing, certain tax credits and the deductibility of certain expenses.
• The company is also involved in various lawsuits, claims, government investigations, and other legal proceedings that arise in the ordinary course of business.

Score: 6

Explanation: The sentiment is neutral. While there are positives like growth in certain product lines and cost-saving initiatives, the overall revenue decline and challenges in the U.S. market temper the outlook.

• Growth Portfolio revenues increased by 16%, indicating strong performance from newer products.
• GAAP diluted EPS increased significantly, reflecting improved profitability compared to the previous year.
• Multiple regulatory approvals were achieved across the portfolio, including approvals for Opdivo + Yervoy in the EU and U.S., and Camzyos in Japan.
• Strategic productivity initiatives are expected to yield $2.0 billion in annual cost savings by the end of 2027.

• Total revenues decreased by 6%, indicating challenges in maintaining overall sales momentum.
• Legacy Portfolio revenues declined by 20% due to generic erosion, impacting overall revenue.
• U.S. revenues decreased by 7%, reflecting challenges in the domestic market.
• Increased pricing pressure and other restrictions in the U.S. and abroad continue to negatively affect revenues and profit margins.

• Generic erosion of key products like Revlimid, Sprycel, and Abraxane continues to impact revenue.
• The redesign of the U.S. Medicare Part D program is negatively affecting sales of Eliquis.
• Increased pricing pressure and other restrictions in the U.S. and abroad continue to negatively affect revenues and profit margins.
• Ongoing examinations by tax authorities could lead to material adjustments to tax positions.
• Failure to successfully enforce BMSs patent rights would likely result in substantial decreases in the respective product revenues from generic competition.

The company expects to realize annual cost savings of approximately $2.0 billion by the end of 2027 from its productivity initiative.

The pharmaceutical industry is facing increased pricing pressures and regulatory scrutiny, impacting revenue and profitability. BMS is strategically focusing on innovative medicines and operational efficiency to navigate these challenges.

• BMS's performance can be compared to other major pharmaceutical companies such as Pfizer, Merck, Novartis, and Roche.
• These companies also face similar challenges related to generic competition, pricing pressures, and regulatory changes.
• For example, Merck's Keytruda royalties impact BMS's financials, highlighting the interconnectedness of the industry.
• The success of BMS's Growth Portfolio is crucial for offsetting declines in legacy products, a strategy also employed by competitors.
• The company's restructuring efforts align with industry trends of streamlining operations to improve efficiency and profitability.

• Shareholders: The decrease in revenue and the ongoing legal and regulatory challenges may negatively impact shareholder value.
• Employees: Restructuring initiatives may lead to job losses, while stock-based compensation plans incentivize performance.
• Customers: New drug approvals and expanded indications provide patients with more treatment options.
• Suppliers: Changes in the supply chain and manufacturing network may affect relationships with suppliers.
• Creditors: The company's net debt position and access to credit facilities ensure its ability to meet financial obligations.

• Continue driving commercial execution in key marketed products.
• Advance late-stage R&D programs in Phase III development.
• Monitor and evaluate the impact of the IRA on the business.
• Work cooperatively with the IRS to resolve tax issues.

• BMS is involved in litigations throughout Europe against companies seeking to launch generic apixaban products prior to the expiration of the composition-of-matter patent for Eliquis and its associated SPCs.
• In December 2024, Celgene received a Notice Letter from Cipla USA, Inc. (Cipla) notifying Celgene that Cipla had filed an ANDA containing paragraph IV certifications seeking approval to market generic pomalidomide products in the U.S.
• In October 2021, Actelion Pharmaceuticals LTD and Actelion Pharmaceuticals US, INC (Actelion) filed a complaint for patent infringement in the United States District Court for the District of New Jersey against BMS and Celgene for alleged infringement of U.S. Patent No. 10,251,867 (the 867 Patent).
• BMS and certain Sanofi entities are defendants in a consumer protection action brought by the attorney general of Hawaii relating to the labeling, sales and/or promotion of Plavix *.
• Beginning in March 2018, two putative class actions were filed against Celgene and certain of its officers and employees in the U.S. District Court for the District of New Jersey (the Celgene Securities Class Action).
• In June 2021, an action was filed against BMS in the U.S. District Court for the Southern District of New York asserting claims of alleged breaches of a Contingent Value Rights Agreement (CVR Agreement) entered into in connection with the closing of BMSs acquisition of Celgene in November 2019.
• On June 16, 2023, BMS filed a lawsuit against HHS and the Centers for Medicare & Medicaid Services, et al. , challenging the constitutionality of the drug-pricing program in the IRA.
• On November 26, 2024, BMS filed a lawsuit against Carole Johnson, Administrator of Health Resources & Services Administration (HRSA) and Xavier Becerra, U.S. Secretary of HHS, challenging HRSAs determination that BMS could not implement a cash rebate model for the 340B drug pricing program.
• Beginning in November 2014, putative class action lawsuits were filed against Celgene in the U.S. District Court for the District of New Jersey alleging that Celgene violated various antitrust, consumer protection, and unfair competition laws in connection with, among other things, activities related to obtaining and litigating certain Revlimid patents.
• Beginning in September 2023, certain entities filed putative class actions against Celgene, BMS, and certain individuals in the U.S. District Court for the Southern District of New York asserting claims under various antitrust, consumer protection, and unjust enrichment laws in connection with activities related to obtaining and litigating certain Pomalyst patents.

• 2018-03-31: Beginning of Celgene Securities Litigations
• 2019-11: Closing of BMSs acquisition of Celgene
• 2021-02-01: Start date of Attorney General of Hawaii V. Bristol-Myers Squibb And Sanofi case
• 2021-06: An action was filed against BMS in the U.S. District Court for the Southern District of New York asserting claims of alleged breaches of a Contingent Value Rights Agreement
• 2023: BMS commenced a restructuring plan to accelerate the delivery of medicines to patients
• 2024-01-23: BMS acquired Mirati
• 2024-02-26: BMS acquired RayzeBio
• 2024-03-18: BMS acquired Karuna
• 2024-05-01: Following a new trial, in May 2024, the trial court issued a new decision against Sanofi and BMS, imposing penalties in the total amount of $916 million, with $458 million attributed to BMS.
• 2025-01: The maximum amount of commercial paper that may be issued under BMS's commercial paper program was reduced in January 2025 from $7.0 billion as of December 31, 2024 to $5.0 billion.
• 2025-02: BMS obtained a global exclusive license from BioArctic for its PyroGlutamate-amyloid-beta antibody program
• 2025-03-10: BMS entered into a definitive merger agreement to acquire 2seventy bio
• 2025-03-31: End of the quarterly period
• 2025-04-17: Date shares outstanding were calculated