Summary
Bristol-Myers Squibb Company (BMY) reported a net loss attributable to the company of $711 million ($0.43 per diluted share) for the third quarter of 2012, a significant shift from the net earnings of $969 million ($0.56 per diluted share) in the same period of the prior year. This loss was heavily influenced by a substantial $1.8 billion impairment charge related to the Inhibitex acquisition and discontinued development of BMS-986094. Revenue also saw a sharp decline, down 30% to $3.7 billion, primarily due to the loss of exclusivity for key products like Plavix and Avapro/Avalide, which had previously contributed over $8 billion in combined sales in 2011. The company completed the significant acquisition of Amylin Pharmaceuticals for $5.3 billion, which, along with restructuring provisions and litigation expenses, contributed to the increased total expenses. Despite the quarterly loss and revenue decline, BMY is strategically focused on growing its newer key marketed products, advancing its pipeline, and expanding in emerging markets. The company also secured significant financing through new debt issuances and a $3.8 billion collaboration payment from AstraZeneca related to the Amylin acquisition. Management is emphasizing its pipeline advancements in immuno-oncology, cardiovascular/metabolic disease, and virology, alongside its biologics capabilities, to build a foundation for future growth. Investors should note the impact of patent expirations on near-term financial performance while observing the company's long-term strategic initiatives.
Financial Highlights
58 data points| Revenue | $3.74B |
| Cost of Revenue | $987.00M |
| Gross Profit | $2.75B |
| R&D Expenses | $951.00M |
| SG&A Expenses | $1.07B |
| Operating Expenses | $5.00B |
| Interest Expense | $48.00M |
| Net Income | -$711.00M |
| EPS (Basic) | $-0.43 |
| EPS (Diluted) | $-0.43 |
| Shares Outstanding (Basic) | 1.67B |
| Shares Outstanding (Diluted) | 1.67B |
Key Highlights
- 1Significant Q3 2012 Net Loss: Bristol-Myers Squibb reported a net loss of $711 million, or $0.43 per diluted share, a sharp contrast to the $969 million net earnings in Q3 2011.
- 2Revenue Decline: Total net sales decreased by 30% to $3.7 billion for the third quarter of 2012, primarily due to the loss of exclusivity for Plavix and Avapro/Avalide.
- 3Major Impairment Charge: A $1.8 billion pre-tax impairment charge was recognized due to the discontinuation of development for BMS-986094 (formerly INX-189) following safety concerns.
- 4Acquisition of Amylin Pharmaceuticals: The company completed the acquisition of Amylin for approximately $5.3 billion, expanding its diabetes franchise and operations.
- 5Strategic Alliance Restructuring: Terms of the codevelopment and cocommercialization agreements with Sanofi were restructured, with Sanofi assuming worldwide operations for most products starting in 2013, in exchange for royalties and a terminal payment.
- 6Pipeline Advancements: Despite challenges, the company highlighted regulatory developments for Eliquis and Forxiga, and positive clinical data for Yervoy.
- 7Increased Debt and Cash Usage: The company issued $2.0 billion in senior unsecured notes and utilized existing cash balances and debt to finance the Amylin acquisition, leading to a decrease in cash and a negative net cash position.