01—Abstract
Summary
Summary of the 10-K filed February 17, 2012. Cited figures are marked; the original filing is the authoritative source.
Bristol-Myers Squibb Company (BMY) reported strong performance in its 2011 10-K filing, highlighting continued strategic transformation into a biopharmaceutical company focused on innovative medicines.
The company successfully launched several new products, including Yervoy, a subcutaneous formulation of Orencia, Nulojix, and Eliquis in the EU. Significant R&D investment of $3.8 billiona was made to fuel its pipeline, with a focus on areas like oncology, immunology, and virology.
The company is strategically positioning itself for future growth, particularly as it anticipates the loss of U.S. market exclusivity for its top-selling product, Plavix, in May 2012, and Avapro/Avalide in March 2012. Despite the upcoming patent expirations, BMS is focused on its pipeline and a cost-efficient operational model to sustain its business and drive future growth.
02—Key points
Key Highlights
- BMY reported net sales of $21.24 billion for 2011, a 9% increase from 2010, driven by strong performance in key products and new launches.
- The company invested $3.8 billion in Research and Development (R&D) in 2011, reflecting its commitment to innovation and pipeline development.
- BMY successfully launched Yervoy (ipilimumab) in the US and EU for melanoma, and also launched new formulations/products like subcutaneous Orencia, Nulojix, and Eliquis (EU).
- The company is proactively addressing the upcoming loss of U.S. market exclusivity for Plavix (May 2012) and Avapro/Avalide (March 2012), which are significant revenue drivers.
- BMY continued its 'string-of-pearls' acquisition and licensing strategy, with key acquisitions including Amira Pharmaceuticals and Inhibitex Inc.
- Despite increased spending on marketing and R&D, the company managed its cost structure, with cost of goods sold as a percentage of net sales decreasing slightly year-over-year.
- Financial position remained strong, with total cash, cash equivalents, and marketable securities at $11.64 billion as of December 31, 2011.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2011, Bristol Myers Squibb Co kept $0.17.
- Revenue$21.24B100.0%
- Cost of revenue−$5.60B26.4%
- Gross profit$15.65B73.6%
- Operating costs−$11.94B56.2%
- Operating income$3.71B17.5%
- Interest, other & tax$-00.0%
- Net income$3.71B17.5%
Where FY2011 revenue went
$21.24B- Cost of revenue: $5.60B, 26% of revenue
- SG&A: $4.20B, 20% of revenue
- Other operating costs: $3.90B, 18% of revenue
- R&D: $3.84B, 18% of revenue
- Net income: $3.71B, 17% of revenue
Kept 17% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2011filed February 17, 2012Financial Statements
FY2011 against FY2010
| Line item | FY2011FY2010 | Change |
|---|---|---|
| Revenue | $21.24B$19.48B | +9.0% |
| Cost of Revenue | $5.60B$5.28B | +6.1% |
| Gross Profit | $15.65B$14.21B | +10.1% |
| R&D Expenses | $3.84B$3.57B | +7.7% |
| SG&A Expenses | $4.20B$3.69B | +14.0% |
| Operating Expenses | $14.26B$13.41B | +6.3% |
| Operating Income | $3.71B$3.10B | +19.6% |
| Interest Expense | $145.00M$145.00M | 0.0% |
| Net Income | $3.71B$3.10B | +19.6% |
| EPS (Basic) | $2.18$1.80 | +21.1% |
| EPS (Diluted) | $2.16$1.79 | +20.7% |
| Shares Outstanding (Basic) | 1.70B1.71B | −0.8% |
| Shares Outstanding (Diluted) | 1.72B1.73B | −0.6% |
05—Questions
Frequently Asked Questions
What are the key products driving Bristol-Myers Squibb's revenue in 2011?
In 2011, Bristol-Myers Squibb's key products, which represented 86% of total net sales, included Plavix ($7.1 billion), Abilify ($2.8 billion), Reyataz ($1.6 billion), the Sustiva Franchise ($1.5 billion), and Baraclude ($1.2 billion). These products are critical to the company's revenue generation.
What are the major risks facing Bristol-Myers Squibb related to patent expirations?
The most significant risk identified is the upcoming loss of U.S. market exclusivity for Plavix in May 2012 and Avapro/Avalide in March 2012. The company anticipates a rapid and material decline in sales for these products following exclusivity loss, which could significantly impact its financial results.
How is Bristol-Myers Squibb investing in future growth?
Bristol-Myers Squibb is investing heavily in its pipeline through a robust R&D program, spending $3.8 billion in 2011. The company is also actively pursuing its 'string-of-pearls' strategy, which involves strategic acquisitions and licensing of innovative products, such as the recent acquisitions of Amira Pharmaceuticals and Inhibitex Inc., to build a strong portfolio for the future.
What is the impact of U.S. healthcare reform on Bristol-Myers Squibb?
The U.S. healthcare reform legislation enacted in 2010 has had a financial impact, increasing costs through higher Medicaid rebates and a new annual pharmaceutical company fee. The company reported an increased EPS impact from U.S. healthcare reform from $0.10 in 2010 to $0.24 in 2011, primarily due to the Medicare Part D coverage gap discount and the annual fee.
06—Continue