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Will Opdivo & Eliquis Drive Bristol-Myers (BMY) Q4 Earnings?

Zacks Equity Research

Bristol-Myers’ BMY immuno-oncology drug, Opdivo, which is approved for multiple oncology indications, fueled the top line in the third quarter of 2019. The uptake of the drug continued to be strong in metastatic and adjuvant melanoma, and first-line renal cell carcinoma in the United States. In fact, the trend most likely continued in the fourth quarter. However, the size of the eligible pool of second-line lung cancer patients declined in the third quarter and the same most likely prevailed in the fourth quarter.

In international markets, Opdivo is likely to have benefited from the uptake in renal and adjuvant melanoma.

Apart from the drug’s sales, investors will also look forward to key pipeline updates on the ongoing studies of Opdivo. Bristol-Myers recently withdrew its application in the European Union (EU) for the combination of Opdivo and Yervoy in advanced non-small cell lung cancer (NSCLC), based on data from CheckMate-227.

Though the Committee for Medicinal Products for Human Use (CHMP) acknowledged the integrity of the patient data, it determined that a full assessment of the application was not possible following the multiple protocol changes the company made in response to the rapidly evolving science and data. Consequently, Bristol-Myers has no plans to resubmit this application in the EU.

In January 2020, the FDA granted a Priority Review status to the Opdivo-Yervoy combination for the treatment of first-line NSCLC.

Investors will be focusing on further updates on the same as competition is stiff in this space from the likes of Merck’s MRK Keytruda and Roche’s RHHBY Tecentriq.

The FDA accepted the supplemental Biologics License Application (sBLA) and granted Breakthrough Therapy designation to the combination for the treatment of patients with advanced hepatocellular carcinoma (HCC) previously treated with sorafenib. The FDA granted a Priority Review to the application, with a Prescription Drug User Fee Act (PDUFA) goal date of Mar 10, 2020.

Eliquis delivered a stellar performance during the first nine months of 2019, propelled by increased share in the novel oral anticoagulant (NOAC) market, a trend that most likely continued in the fourth quarter. Per the company, Eliquis is now the number one oral anticoagulant in multiple countries outside the United States.

The third quarter saw continued stable demand for Sprycel in the United States and the same is likely to have continued in the fourth quarter.

Meanwhile, in November 2019, Bristol-Myers completed the impending acquisition of Celgene Corporation. The acquisition added blockbuster oncology drug, Revlimid, to its portfolio. The drug is expected to have significantly contributed to the company’s fourth-quarter performance.

In November 2019, the FDA approved Celgene’s Reblozyl for the treatment of anemia in adult patients with beta thalassemia, who require regular red blood cell (RBC) transfusions. The top line is likely to have got a boost from the incremental contribution of Reblozyl.

The Zacks Consensus Estimate for fourth-quarter sales and earnings is pegged at $6.14 billion and 88 cents, respectively.

Bristol-Myers’ shares have gained 25% in the past year compared with the industry’s growth of 0.9%.

 

Apart from these, investors will focus on further updates on the company’s pipeline progress. Bristol-Myers submitted a Biologics License Application (BLA) to the FDA for lisocabtagene maraleucel (liso-cel), its autologous anti-CD19 chimeric antigen receptor (CAR) T cell immunotherapy, comprising individually formulated CD8+ and CD4+ CAR T cells for the treatment of adult patients with relapsed or refractory (R/R) large B-cell lymphoma (LBCL) after at least two prior therapies.

Zacks Rank & A Stock to Consider

Bristol-Myers currently carries a Zacks Rank #3 (Hold).

A better-ranked stock in the same space is Pfizer PFE, which carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Pfizer’s earnings estimates have increased to $2.77 from $2.65 in the past 60 days.

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