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BMS Q4 results see earnings increase despite fall in sales

Cost-cutting measures at pharma company help overcome patent losses

Cost-cutting helped Bristol-Myers Squibb exceed earnings forecasts in the fourth quarter of 2012, despite a 23 per cent drop in revenues to $4.19bn.

As in prior quarters the main reason for the drop was loss of US patent protection for antihypertensive blockbuster Avapro (irbesartan) and anticoagulant Plavix (clopidogrel), which caused a 38 per cent slump in US sales while international revenues managed a 6 per cent increase.

Last year was always going to be tough for BMS, but the company pleased investors after posting higher-than-expected earnings per share (EPS) of $0.56, up 12 per cent on the same period of 2011 thanks to cost controls.

There were also encouraging signs from BMS' crop of new products, which put in an "especially strong performance" in the fourth quarter, said chief executive Lamberto Andreotti on a conference call.

Among these, rheumatoid arthritis drug Orencia (abatacept) grew 26 per cent to $325m, while Yervoy (ipilimumab) for melanoma raced ahead 47 per cent to bring in $211m in the quarter and $700m in its first full year on the market. Leukaemia treatment Sprycel (dasatinib) posted sales of $281m, a rise of 24 per cent, and hepatitis drug Baraclude (entecavir monohydrate) rose 13 per cent to $360m

The Onglyza (saxagliptin) diabetes franchise also did well - rising 29 per cent to $198m in the quarter - although BMS noted that the DPP-4 inhibitor sector is becoming increasingly crowded. And staying in the diabetes arena, BMS' two exenatide-based drugs Byetta and Bydureon - acquired as part of its $5.3bn purchase of Amylin last year - added $152m to its coffers.

The performance of these products, along with new entrants into the pipeline including Forxiga (dapagliflozin) for diabetes and anticoagulant Eliquis (apixaban), encouraged shareholders and helped BMS shares rise 2.6 per cent on the New York Stock Exchange (NYSE) yesterday, closing at $35.81.

Analysts have suggested that much of BMS' future fortune hangs on Eliquis, which was approved in Europe, Canada, Japan, the US and South Korea in the fourth quarter and has started to make its first sales. A launch in the US with partner Pfizer is due to take place next week, said Andreotti.

The CEO also highlighted BMS' late-stage pipeline, noting that nivolumab is already in multiple phase III trials for lung and renal cancer as well as melanoma, while elotuzumab has now reached the pivotal trials stage in multiple myeloma. He also expects the company to be able to file for approval of an all-oral regimen for hepatitis C in Japan by the end of the year and enter the market there in 2014.

"2013 will be a year of clinical advances, launches, commercial execution, investments, all of which will allow us to deliver our full long-term potential," said Andreotti.

Pay outs for patients harmed by hepatitis C drug
Meanwhile, BMS has agreed to pay out $80m to 15 patients who claimed to have been harmed by its discontinued hepatitis C drug BMS-986094 during clinical trials, according to a Wall Street Journal report.

The pharma company ended development of the drug last year, just months after it closed a $2.5bn acquisition of originator company Inhibitex.

25th January 2013

From: Sales

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