8-KOther EventsExhibits & Filings

BRISTOL MYERS SQUIBB CO 8-K Report, Corporate Update (Aug 3, 2012)

Filed August 3, 2012For Securities:BMYCELG-RIBMYMP

Summary

Bristol-Myers Squibb Company (BMY) has filed an 8-K report detailing a significant development concerning its hepatitis C drug candidate, BMS-986094 (formerly INX-189). The company voluntarily suspended the administration of the study drug in an ongoing Phase II trial due to a serious safety issue identified, prioritizing patient safety. The exact cause of this safety concern and its relation to the study drug are currently under investigation. This development carries substantial financial implications for BMY. The drug candidate was acquired through the purchase of Inhibitex, Inc. in February 2012 for an amount that resulted in an in-process research and development intangible asset with a carrying value of $1.8 billion as of June 30, 2012. The company is currently assessing whether this significant asset will require an impairment charge, which could materially impact future financial statements and earnings.

Key Highlights

  • 1BMY has voluntarily suspended drug administration in a Phase II study of BMS-986094 for hepatitis C treatment due to a serious safety issue.
  • 2The suspension is a precautionary measure to ensure patient safety while the cause of the issue is investigated.
  • 3The cause of the safety issue and its potential link to the study drug are currently unknown.
  • 4BMS-986094 was acquired through the acquisition of Inhibitex, Inc. in February 2012.
  • 5The in-process R&D intangible asset related to BMS-986094 had a carrying value of $1.8 billion as of June 30, 2012.
  • 6BMY is evaluating the need for an impairment charge on this $1.8 billion asset.

Frequently Asked Questions

The primary reason for this filing is Bristol-Myers Squibb's decision to suspend the study drug administration in a Phase II trial for BMS-986094 (a hepatitis C treatment) due to a serious safety issue that has emerged, prompting concerns for patient safety.

The drug candidate, BMS-986094, was acquired for a significant amount, with its associated in-process R&D intangible asset valued at $1.8 billion as of June 30, 2012. The company is currently assessing whether this asset will require an impairment charge, which could lead to a substantial write-down on their balance sheet and impact reported earnings.

BMS-986094 was acquired by Bristol-Myers Squibb as part of its acquisition of Inhibitex, Inc. in February 2012. It is a nucleotide polymerase (NS5B) inhibitor being developed for the treatment of hepatitis C.

The company is investigating the cause of the serious safety issue and its potential relationship to the study drug. They are also assessing whether an impairment charge is necessary for the related $1.8 billion intangible asset.