Bristol-Myers Squibb Reports Second Quarter Financial Results

NEW YORK–(BUSINESS WIRE)– Bristol-Myers
Squibb Company (NYSE:BMY) today reported results for the second
quarter of 2016, which were highlighted by strong sales, key regulatory
and clinical milestones in Immuno-Oncology and business development
transactions that strengthened the company’s Immuno-Oncology pipeline.

“During the second quarter we delivered strong sales and earnings
growth, achieved important regulatory milestones with Opdivo
across multiple types of cancer, and further advanced our leadership in
Immuno-Oncology through the breadth of the clinical data we presented at
ASCO,” said Giovanni
Caforio, M.D., chief executive officer, Bristol-Myers Squibb. “I am
confident strong performance of our in-line products, progress with our
diversified pipeline and our focused approach to business development
position us well for continued success.”

**In excess of +/- 100%

SECOND QUARTER FINANCIAL RESULTS

• Bristol-Myers Squibb posted second quarter 2016 revenues of $4.9
  billion, an increase of 17% compared to the same period a year ago.
  Global revenues increased 18% adjusted for foreign exchange impact.
  Excluding Abilify
  and Erbitux,
  global revenues increased 24% or 26% adjusted for foreign exchange
  impact.
• U.S. revenues increased 46% to $2.7 billion in the quarter compared to
  the same period a year ago. International revenues decreased 6%
  primarily from lower Hepatitis C Franchise sales in Japan and France.
  When adjusted for foreign exchange impact, international revenues
  decreased 4%.
• Gross margin as a percentage of revenues was 75.2% in the quarter
  compared to 75.7% in the same period a year ago.
• Marketing, selling and administrative expenses increased 9% to $1.2
  billion in the quarter.
• Research and development expenses decreased 32% to $1.3 billion in the
  quarter. Research and development expenses in the second quarter of
  2015 include an $800 million charge resulting from the Flexus
  acquisition.
• The effective tax rate was 26.4% in the quarter, compared to 311.5% in
  the second quarter last year. The second quarter 2015 Flexus
  acquisition was non-deductible for tax purposes.
• The company reported net earnings attributable to Bristol-Myers Squibb
  of $1.2 billion, or $0.69 per share, in the quarter compared to a net
  loss of $130 million, or $0.08 per share, a year ago. The results in
  the second quarter of 2015 include a $0.48 per share charge from the
  Flexus acquisition.
• The company reported non-GAAP net earnings attributable to
  Bristol-Myers Squibb of $1.2 billion, or $0.69 per share, in the
  second quarter, compared to $890 million, or $0.53 per share, for the
  same period in 2015. An overview of specified items is discussed under
  the “Use of Non-GAAP Financial Information” section.
• Cash, cash equivalents and marketable securities were $7.9 billion,
  with a net cash position of $1.2 billion, as of June 30, 2016.

SECOND QUARTER PRODUCT AND PIPELINE UPDATE

Global revenues for the second quarter of 2016, compared to the second
quarter of 2015, were driven by Opdivo, which grew by $718
million; Eliquis,
which grew 78%; Orencia,
which grew 29%; Hepatitis C Franchise, which grew 14%; and Sprycel,
which grew 11%.

Opdivo

• In July, the U.S. Food and Drug Administration (FDA) accepted for
  priority review and the European Medicines Agency (EMA) validated the
  applications we submitted for Opdivo for patients with
  previously treated recurrent or metastatic squamous cell carcinoma of
  the head and neck (SCCHN). Additionally, in Japan, Bristol-Myers
  Squibb’s partner Ono Pharmaceuticals submitted an application for Opdivo
  in SCCHN. The three submissions were based on CheckMate -141, a
  pivotal Phase 3 open-label, randomized study, that evaluated the
  overall survival (OS) of Opdivo in patients with SCCHN after
  platinum therapy compared to investigator’s choice of therapy
  (methotrexate, docetaxel, or cetuximab). This study was stopped early
  in January 2016 because an assessment conducted by the independent
  Data Monitoring Committee concluded the study met its primary endpoint
  of OS. The projected FDA action date is November 11, 2016.
• In June, the FDA granted Breakthrough Therapy Designation to Opdivo
  for the potential indication of unresectable locally advanced or
  metastatic urothelial carcinoma that has progressed on or after a
  platinum-containing regimen. As part of the Breakthrough Therapy
  Designation submission, the company shared for the FDA’s review
  results from Phase 2 study CA209-275 and other supportive data
  investigating Opdivo in these previously treated bladder cancer
  patients.
• In May, the FDA approved Opdivo for the treatment of patients
  with classical Hodgkin lymphoma (cHL) who have relapsed or progressed
  after autologous hematopoietic stem cell transplantation (auto-HSCT)
  and post-transplantation brentuximab vedotin. This accelerated
  approval was based on overall response rate. This first approval of a
  PD-1 inhibitor for cHL patients who have relapsed or progressed after
  auto-HSCT and post-transplantation brentuximab vedotin is based on a
  combined analysis of data from the Phase 2 CheckMate -205 and the
  Phase 1 CheckMate -039 study. Continued approval for this indication
  may be contingent upon verification and description of clinical
  benefit in confirmatory trials.
• In May, the European Commission (EC) approved Opdivo in
  combination with Yervoy
  for the treatment of advanced unresectable or metastatic melanoma in
  adults, representing the first and only approved combination of two
  Immuno-Oncology (I-O) agents in the European Union (EU). The approval
  is based on the results of the Phase 3 study CheckMate -067, the first
  Phase 3, double-blind, randomized study, in which the Opdivo + Yervoy
  regimen and Opdivo monotherapy demonstrated superior
  progression-free survival (PFS) and objective response rates (ORR) in
  patients with advanced melanoma, regardless of BRAF mutational status,
  versus Yervoy alone. This approval allows for the marketing of
  the Opdivo + Yervoy regimen in all 28 Member States of
  the EU.
• In June, during the Congress of the European Hematology Association
  (EHA) in Copenhagen, Denmark, the company announced results from
  CheckMate -205, a Phase 2 registrational study evaluating Opdivo
  in patients with cHL. The primary endpoint of ORR per an independent
  radiologic review committee (IRRC) was 66%. In an exploratory
  analysis, the authors observed 72% of patients who did not respond to
  the most recent prior brentuximab vedotin treatment did respond to Opdivo.
  The safety profile of Opdivo in CheckMate -205 was consistent
  with previously reported data in this tumor type.
• In June, during ASCO in Chicago, the company announced results from
  eight studies for Opdivo and the Opdivo + Yervoy
  regimen:
  • CheckMate -067: In the pivotal Phase 3 study evaluating the Opdivo
    + Yervoy regimen or Opdivo monotherapy
    versus Yervoy monotherapy in patients with previously
    untreated advanced melanoma, including both BRAF V600
    mutation positive or BRAF wild-type advanced melanoma,
    at a minimum follow-up of 18 months, the Opdivo + Yervoy regimen
    demonstrated continued clinical benefit with a 58% reduction in
    the risk of disease progression versus Yervoy monotherapy,
    while Opdivo monotherapy demonstrated a 45% risk reduction
    versus Yervoy alone. The safety profile of the Opdivo +
    Yervoy combination regimen in CheckMate -067 was consistent
    with previously reported studies of the combination.
  • CheckMate -069: In a post-hoc analysis from the Phase 2 study
    evaluating patients with previously untreated unresectable or
    metastatic melanoma who received either the Opdivo + Yervoy
    regimen or Yervoy alone, durable responses were observed
    with the combination regimen in a subgroup of 35 patients who
    discontinued therapy due to treatment-related adverse events and
    appeared consistent with the overall randomized patient
    population. Among this subgroup of patients, the ORR was 66%, and
    20% achieved a complete response, with a minimum follow-up of two
    years. At two years, the median duration of response was not
    reached and 74% remain in response. The safety profile of the Opdivo
    + Yervoy regimen in CheckMate -069 was consistent with
    previously reported studies of the combination.
  • CA209-003: In this Phase 1 study evaluating Opdivo in
    patients with previously treated advanced renal cell carcinoma
    (RCC), in which OS is an exploratory endpoint, 38% of patients
    were alive at four years and 34% of patients were alive at five
    years. The long-term safety profile of Opdivo was
    consistent with previously reported studies.
  • CA209-010: In this Phase 2 study evaluating Opdivo in
    patients with previously treated advanced RCC in which OS was a
    secondary endpoint, 29% of patients were alive at four years. The
    long-term safety profile of Opdivo was consistent with
    previously reported studies.
  • CheckMate -025: In this pivotal Phase 3 study comparing Opdivo versus
    everolimus in patients with advanced RCC who received prior
    anti-angiogenic therapy, 55% of patients treated with Opdivo experienced
    a clinically meaningful improvement in disease-related symptoms,
    as defined in the study, versus 37% of patients treated with
    everolimus. This additional analysis of health-related quality of
    life data was a secondary endpoint in the study.
  • CheckMate -142: In this Phase 2 study evaluating Opdivo alone
    or in combination with Yervoy in patients with previously
    treated metastatic colorectal cancer, including those with high
    microsatellite instability (MSI), the primary endpoint of
    investigator-assessed ORR for MSI-high metastatic colorectal
    cancer patients was 26% for Opdivo monotherapy and 33% for
    the Opdivo + Yervoy combination regimen. The
    six-month progression-free survival rates were 46% for Opdivo
    monotherapy and 67% for the Opdivo + Yervoy combination
    in patients with MSI-high metastatic colorectal cancer. The safety
    profile of Opdivo alone or in combination with Yervoy was
    consistent with other tumor types and prior combination studies.
  • CheckMate -032: In this Phase 1/2 study evaluating Opdivo
    in patients with metastatic urothelial cancer, the most common
    type of bladder cancer, after platinum-based therapy, the primary
    endpoint of investigator-assessed confirmed ORR was 24% in
    patients treated with Opdivo, with a minimum follow-up of
    nine months. At one year, patients treated with Opdivo had
    an OS rate, a secondary endpoint, of 46%, with a median OS of 9.72
    months. Response rates by tumor PD-L1 expression, evaluated as an
    exploratory endpoint, were similar regardless of PD-L1 expression
    levels. The safety profile of Opdivo in CheckMate -032 was
    consistent with the known safety profile of Opdivo in other
    tumor types.
  • CheckMate -012: In this Phase 1b trial evaluating Opdivo and
    Yervoy in patients with chemotherapy-naïve advanced
    non-small cell lung cancer (NSCLC), findings from a pooled
    analysis of two Opdivo + Yervoy combination regimen
    cohorts [3 mg/kg of Opdivo every two weeks plus 1 mg/kg of Yervoy
    either every six (Q6W) or 12 weeks (Q12W)] in the study
    showed the magnitude of response rate from the combination regimen
    cohorts was enhanced with increased PD-L1 expression. In these
    combination regimen cohorts, the confirmed ORR in patients with
    ≥1% PD-L1 expression was 57% and the confirmed ORR was up to 92%
    (n=12/13) in patients with ≥50% PD-L1 expression. In patients with
    <1% PD-L1 expression, the confirmed ORR was 15%. Improved safety
    and tolerability was observed with current Opdivo + Yervoy
    combination cohorts compared to those previously studied in NSCLC.
• In May, in conjunction with ASCO, the company announced results from
  two studies for Opdivo:
  • CheckMate -057: In this Phase 3 study evaluating Opdivo
    versus docetaxel in previously treated metastatic non-squamous
    NSCLC patients, Opdivo continued to demonstrate improved
    OS, the primary endpoint, at the landmark two-year time point,
    with 29% of patients treated with Opdivo alive at two years
    versus 16% of those treated with docetaxel. The safety profile of Opdivo
    at two years was consistent with previous reports of data from
    this study.
  • CheckMate -017: In this Phase 3 study evaluating Opdivo
    versus docetaxel in previously treated metastatic squamous NSCLC
    patients, Opdivo continued to demonstrate improved OS, the
    primary endpoint, at the landmark two-year time point, with 23% of
    patients treated with Opdivo alive at two years versus 8%
    of those treated with docetaxel. The safety profile of Opdivo at
    two years was consistent with previous reports of data from this
    study.

Empliciti

• In May, the company and its partner, AbbVie Inc., announced the EC
  approval of Empliciti for the treatment of multiple myeloma as
  combination therapy with lenalidomide and dexamethasone in patients
  who have received at least one prior therapy. The approval of this
  first and only immunostimulatory antibody for multiple myeloma is
  based on data from the randomized, open label, Phase 3 ELOQUENT-2
  study, which demonstrated that the combination of Empliciti
  with lenalidomide and dexamethasone delivered 53% relative improvement
  in progression-free survival vs. lenalidomide and dexamethasone alone
  at three years.

Orencia/Immunoscience

• In July, the company announced the commercial launch of the ORENCIA
  ClickJect^TM Autoinjector, a new self-administered
  autoinjector for adults with moderate to severe rheumatoid arthritis
  (RA) which was approved by the FDA in June.
• In July, the company announced the EMA Committee for Medicinal
  Products for Human Use (CHMP) recommendation to approve the new
  indication for Orencia, in combination with methotrexate (MTX),
  for the treatment of highly active and progressive disease in adult
  patients with RA who have not received previous MTX treatment. The
  opinion is based on the AGREE and AVERT studies. Assuming EU approval,
  the new indication would make Orencia the first available
  biologic therapy specifically for this indication in the EU.
• In June, the company announced results from three studies at the
  Annual European Congress of Rheumatology (EULAR 2016):
  • In a study exploring patients’ response to treatment for RA based
    on their baseline status for two biomarkers of poor prognosis,
    anti-cyclic citrullinated peptide (anti-CCP, also known as ACPA)
    and rheumatoid factor (RF), data from the Corrona, LLC RA registry
    showed that patients who tested positive for anti-CCP or RF were
    more likely to have a greater response with Orencia
    treatment than patients testing negative for the biomarkers. The
    study did not show significant differences in responses between
    anti-CCP/RF status in those administered TNF-inhibitors.
  • In a Phase 3 study of juvenile idiopathic arthritis (pJIA),
    subcutaneous (SC) Orencia demonstrated equivalent efficacy
    and comparable safety to intravenous (IV) Orencia for pJIA
    patients. SC Orencia showed efficacy after four months with
    greater than 80% of patients achieving an ACR30 response with few
    clinically relevant adverse events.
  • In a Phase 1 study, the company’s investigational Bruton’s
    Tyrosine Kinase (BTK) inhibitor, BMS-986142, targeted for RA and
    other inflammatory diseases, indicated it was well tolerated,
    warranting further development of the agent.

BUSINESS DEVELOPMENT UPDATE

• In July, the company entered into a clinical trial collaboration to
  evaluate the safety, tolerability and efficacy of AbbVie’s
  investigational antibody drug conjugate Rova-T (rovalpituzumab
  tesirine) in combination with Opdivo and Opdivo + Yervoy
  regimen as a second-line treatment for extensive- stage small cell
  lung cancer (SCLC). The Phase 1/2 clinical program will explore
  whether combining these two agents will provide improved and sustained
  efficacy and tolerability above the current treatment protocol of
  chemotherapy and radiation to SCLC patients.

• In July, the company entered into a clinical collaboration to evaluate Opdivo
  in combination with Janssen Biotech, Inc.’s Live Attenuated
  Double-Deleted (LADD) Listerial monocytogenes cancer
  immunotherapy, expressing mesothelin and EGFRvIII (JNJ-64041757), in
  patients with NSCLC. The Phase 2 study will evaluate the tolerability
  and clinical activity of the combination of these agents.
• In July, the company acquired Cormorant Pharmaceuticals, a private,
  Stockholm, Sweden-based pharmaceutical company focused on the
  development of therapies for cancer and rare diseases. The acquisition
  gives Bristol-Myers Squibb full rights to Cormorant’s HuMax-IL8
  antibody program and the lead candidate HuMax-IL8, a Phase 1/2
  monoclonal antibody targeted against interleukin-8 (IL-8) that
  represents a potentially complementary Immuno-Oncology mechanism of
  action to T-cell directed antibodies and co-stimulatory molecules.
• In June, the company entered into an exclusive clinical collaboration
  agreement to evaluate the safety, tolerability, and preliminary
  efficacy of PsiOxus’ enadenotucirev, a systemically administered
  oncolytic adenovirus therapeutic, in combination with Opdivo to
  treat a range of tumor types in late-stage cancer patients. The
  clinical collaboration will support Phase 1 studies to determine
  whether combining these two agents can significantly improve
  the proportion of patients achieving objective tumor responses, the
  extent of tumor shrinkage, and/or the durability of responses.
• In June, the company and the University of Texas MD Anderson Cancer
  Center entered into a new clinical research collaboration to evaluate
  strategies for the potential use of Opdivo + Yervoy to
  treat early- and advanced-stage lung cancer patients. The
  collaboration will help support multiple Phase 1 and 2 clinical trials
  testing Opdivo as monotherapy, in combination with Yervoy,
  or in regimens with other agents, radiation or surgery in a range of
  clinical settings. These studies will also incorporate extensive
  translational work including exploration of novel biomarkers to better
  differentiate responders from non-responders in lung cancer as well as
  preclinical studies of next generation immunotherapeutic agents that
  may be used to expand the benefits to larger numbers of patients.

2016 FINANCIAL GUIDANCE

Bristol-Myers Squibb is increasing its 2016 GAAP EPS guidance range from
$2.37 – $2.47 to $2.43 – $2.53. The company is also increasing its
non-GAAP EPS guidance range from $2.50 – $2.60 to $2.55 – $2.65. Both
GAAP and non-GAAP guidance assume current exchange rates. Key revised
2016 non-GAAP line-item guidance assumptions include:

• Research and development expenses increasing in the mid-teen range.

• The effective tax rate is now expected to be 22%.

The financial guidance for 2016 excludes the impact of any potential
future strategic acquisitions and divestitures, and any specified items
that have not yet been identified and quantified. The non-GAAP 2016
guidance also excludes other specified items as discussed under “Use of
Non-GAAP Financial Information.” Details reconciling adjusted non-GAAP
amounts with the amounts reflecting specified items are provided in
supplemental materials available on the company’s website.

Use of Non-GAAP Financial Information

This press release contains non-GAAP financial measures, including
non-GAAP earnings and related EPS information, that are adjusted to
exclude certain costs, expenses, gains and losses and other specified
items that are evaluated on an individual basis. These items are
adjusted after considering their quantitative and qualitative aspects
and typically have one or more of the following characteristics, such as
being highly variable, difficult to project, unusual in nature,
significant to the results of a particular period or not indicative of
future operating results. Similar charges or gains were recognized in
prior periods and will likely reoccur in future periods including
restructuring costs, accelerated depreciation and impairment of
property, plant and equipment and intangible assets, R&D charges in
connection with the acquisition or licensing of third party intellectual
property rights, divestiture gains or losses, pension, legal and other
contractual settlement charges and debt redemption gains or losses,
among other items. Deferred and current income taxes attributed to these
items are also adjusted for considering their individual impact to the
overall tax expense, deductibility and jurisdictional tax rates.
Non-GAAP information is intended to portray the results of our baseline
performance, supplement or enhance management, analysts and investors
overall understanding of our underlying financial performance and
facilitate comparisons among current, past and future periods. For
example, non-GAAP earnings and EPS information is an indication of our
baseline performance before items that are considered by us to not be
reflective of our ongoing results. In addition, this information is
among the primary indicators we use as a basis for evaluating
performance, allocating resources, setting incentive compensation
targets and planning and forecasting for future periods. This
information is not intended to be considered in isolation or as a
substitute for net earnings or diluted EPS prepared in accordance with
GAAP.

Statement on Cautionary Factors

This press release contains certain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
regarding, among other things, statements relating to goals, plans and
projections regarding the company’s financial position, results of
operations, market position, product development and business strategy.
These statements may be identified by the fact that they use words such
as « anticipate », « estimates », « should », « expect », « guidance », « project »,
« intend », « plan », « believe » and other words and terms of similar meaning
in connection with any discussion of future operating or financial
performance. Such forward-looking statements are based on current
expectations and involve inherent risks and uncertainties, including
factors that could delay, divert or change any of them, and could cause
actual outcomes and results to differ materially from current
expectations. These factors include, among other things, effects of the
continuing implementation of governmental laws and regulations related
to Medicare, Medicaid, Medicaid managed care organizations and entities
under the Public Health Service 340B program, pharmaceutical rebates and
reimbursement, market factors, competitive product development and
approvals, pricing controls and pressures (including changes in rules
and practices of managed care groups and institutional and governmental
purchasers), economic conditions such as interest rate and currency
exchange rate fluctuations, judicial decisions, claims and concerns that
may arise regarding the safety and efficacy of in-line products and
product candidates, changes to wholesaler inventory levels, variability
in data provided by third parties, changes in, and interpretation of,
governmental regulations and legislation affecting domestic or foreign
operations, including tax obligations, changes to business or tax
planning strategies, difficulties and delays in product development,
manufacturing or sales including any potential future recalls, patent
positions and the ultimate outcome of any litigation matter. These
factors also include the company’s ability to execute successfully its
strategic plans, including its business development strategy, the
expiration of patents or data protection on certain products, including
assumptions about the company’s ability to retain patent exclusivity of
certain products, and the impact and result of governmental
investigations. There can be no guarantees with respect to pipeline
products that future clinical studies will support the data described in
this release, that the compounds will receive necessary regulatory
approvals, or that they will prove to be commercially successful; nor
are there guarantees that regulatory approvals will be sought, or sought
within currently expected timeframes, or that contractual milestones
will be achieved. For further details and a discussion of these and
other risks and uncertainties, see the company’s periodic reports,
including the annual report on Form 10-K, quarterly reports on Form 10-Q
and current reports on Form 8-K, filed with or furnished to the
Securities and Exchange Commission. The company undertakes no obligation
to publicly update any forward-looking statement, whether as a result of
new information, future events or otherwise.

Company and Conference Call Information

Bristol-Myers Squibb is a global biopharmaceutical company whose mission
is to discover, develop and deliver innovative medicines that help
patients prevail over serious diseases. For more information about
Bristol-Myers Squibb, visit us at BMS.com or
follow us on LinkedIn, Twitter,
YouTube
and Facebook.

There will be a conference call on July 28, 2016, at 10:30 a.m. EDT
during which company executives will review financial information and
address inquiries from investors and analysts. Investors and the general
public are invited to listen to a live webcast of the call at http://investor.bms.com
or by calling the U.S. toll free 877-201-0168 or international
647-788-4901, confirmation code: 91350399. Materials related to the call
will be available at the same website prior to the conference call. A
replay of the call will be available beginning at 1:30 p.m. EDT on July
28 through 11:59 p.m. EDT on August 11, 2016. The replay will also be
available through http://investor.bms.com
or by calling the U.S. toll free 855-859-2056 or international
404-537-3406, confirmation code: 91350399.

For more information, contact: Ken Dominski, 609-252-5251, ken.dominski@bms.com,
Communications; John Elicker, 609-252-4611, john.elicker@bms.com,
or Bill Szablewski, 609-252-5894, william.szablewski@bms.com,
Investor Relations.

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