Bristol-Myers Gets Drug Approvals, Awaits More
From Associated Press (October 22, 2010)
NEW YORK -- Bristol-Myers Squibb Co., the maker of popular blood thinners Plavix and Coumadin, is likely to spend some time trumpeting its latest acquisition, plus two recent drug approvals and new research data when it reports its third-quarter results before the stock market opens Tuesday.
WHAT TO WATCH FOR: There could be more details about the $735 million purchase two weeks ago of Zymogenetics Inc., the latest step in a strategy of buying biotech companies or products to transform itself into a biopharmaceutical powerhouse.
Zymogenetics, of Seattle, sells Recothrom, for reducing bleeding during surgeries, and cardiovascular drugs are a Bristol-Myers strength. More importantly, the two companies have a partnership on a hepatitis C treatment in mid-stage testing, pegylated interferon lambda.
Interferons are natural immune system proteins. Genetically engineered interferon, plus a second drug, is widely used against hepatitis C, but causes severe flulike symptoms that force many patients to stop the lengthy treatment before they are cured. Bristol hopes its new type of interferon, which works primarily in the liver rather than throughout the body, won’t cause those nasty side effects.
The company is expected to discuss recent approvals of some drugs for new uses, including Food and Drug Administration approval of hepatitis B treatment Baraclude for liver failure caused by scarring. Japan approved Bristol’s biologic drug for rheumatoid arthritis, Orencia.
Bristol has two drugs with deadlines for U.S. regulators to rule on new uses, coming up on Oct. 28 and 29. Those are Sprycel, now approved for chronic myeloid leukemia patients after other therapies have failed, for use in new patients, and Onglyza in combination with metformin, a cheap, widely used starter drug for diabetes patients, respectively. The Onglyza-metformin combo also awaits approval in the European Union.
Experimental cancer drug ipilimumab, which is getting an expedited review from U.S. regulators, is due for a ruling on approval in late December.
Analysts may ask for an update on plans announced in September to streamline operations, particularly by reducing layers of management. That will bring an expected cut of about 840 jobs, 3 percent of its 28,000 jobs worldwide.
WHY IT MATTERS: The New York-based company needs some major new products because it faces one of the industry’s worst patent cliffs. Between 2011 and 2013, Bristol’s blood thinner Plavix, bipolar disorder treatment Abilify and blood pressure drug Avapro, with combined annual sales of about $10 billion, are expected to face low-cost generic rivals. But unlike its many rivals diversifying into generics and consumer and animal medicines, Bristol is focused on producing new biologic drugs. It already sells ones for cancer and the immune disorder rheumatoid arthritis.
In addition, analysts had high expectations for Onglyza, a drug highly touted by Bristol-Myers when it was launched in August 2009, but it posted a mere $28 million in sales in the second quarter.
Bristol sells two diabetes pills that were blockbusters until they got generic competition -- Glucophage (the brand name for metformin) and Glucovance. It has been looking to repeat their success. So it’s been doing research on and seeking approvals of Onglyza in combination with other diabetes treatments and has recently wrapped up five late-stage studies of experimental diabetes drug in a new class, dapagliflozin.
WHAT’S EXPECTED: Analysts surveyed by Thomson Reuters are anticipating, on average, earnings of 53 cents per share and revenue of $4.92 billion.
LAST YEAR’S QUARTER: A year ago, Bristol-Myers reported net income of 48 cents per share and revenue of $5.49 billion.
(This version CORRECTS Corrects no. of new approvals to 2 in lead and paragraph 5. Clarifies status of pending approvals in paragraph 6. Corrects to Glucovance, sted Glucotrol in paragraph 11. Also moving on general news wires.)
Posted: October 2010