BRISTOL MYERS SQUIBB CO Q3 FY2025 earnings call

• Growth portfolio delivered strong quarter with sales up 17% y-o-y, driven by IO portfolio, Reblozyl, Camzyos, Breyanzi. - Recent launches: Cobenfy and Qvantig performing well. - Clinical and regulatory milestones: Iberdomide Phase III EXCALIBER study showed MRD negativity improvement; pumitamig Phase II data presented, pivotal studies initiated; CD19 NEX-T and Sotyktu data shared. - Business development: Acquisition of Orbital Therapeutics, licensing agreement with PhiloChem, progress with SystImmune. - Manufacturing hub: U.S. hub opened for radiopharmaceuticals to deliver therapies within 3 days of production.

Total company sales were approximately $12.2 billion. The growth portfolio global sales increased 17% year-over-year. Oncology portfolio: Opdivo global sales were approximately $2.5 billion, up 6%; Reblozyl global sales were $615 million in the quarter; Breyanzi sales were $359 million in the quarter; Camzyos global sales increased 88% to $296 million; Eliquis global sales were $3.7 billion, growing 23%; Sotyktu sales grew 20% globally; Cobenfy sales were $43 million in the third quarter and $105 million year-to-date.

• Increased full-year revenue guidance by $750M to a range of $47.5 billion to $48 billion. - Legacy portfolio expected to decline approximately 15% to 17% for the year. - Gross margin guidance remains unchanged at approximately 72%, operating expense guidance $16.5 billion. - EPS range narrowed to between $6.40 and $6.60, midpoint unchanged.

• Potential impact of clinical site issues on study timelines for ADEPT-2. - Regulatory uncertainties for new drug approvals and market access. - Competitive landscape affecting market share of products like Cobenfy and others.

Q: Just I want to start with ADEPT-2. Is there any additional updates you can give us in terms of any actions, if any, that you've taken following some of the clinical site reviews you highlighted on the 2Q earnings?

A: Sure. Thanks for the question, Chris. Maybe I'll start and then obviously, Cristian can chime in with any additional context he has. So just remember, ADEPT-2 is obviously an ongoing study, and it's an ongoing study, as I referenced in my prepared remarks, that has a readout in the next 2 months. So we're not going to be able to provide a lot of specific comments on the product. But what I can say are a few things. First, I will reiterate that we expect results by the end of the year. And of course, we'll communicate those results as we normally do. The second thing I would say, which really gets to the second part of your question is while we remain blinded to the data, our confidence in the Cobenfy development program, including in ADP, continues to be strong. And with respect to ADP, I'd just remind you of the source of that confidence. We obviously have compelling external data going back to the Lilly day in the late '90s. We're hearing very interesting real-world stories based on our experience, albeit in schizophrenia, -- and of course, we have internal data with respect to the ADEPT-1 lead-in and the ADEPT-3 extension data. So that's what I would say about ADEPT-2. But if I step back from the specific studies, remember, the work that we're doing in development fits with the focus that we have on execution really across the company. And given the importance of the late-stage studies, I think it's prudent that we take whatever learnings we can and pull whatever appropriate levers we can to ensure that we deliver these studies with the highest [ PTS ] and on time. We're obviously excited to have Cristian on board to bring a fresh perspective to that. So net-net, I feel good about where we are in terms of working through the broader development programs and ensuring that we're executing appropriately. But Cristian, I don't know if you want to add anything.

Q: Just have a couple. Also on Cobenfy, but more commercial. How would you guys characterize the speed of reimbursement and maybe the depth of prescribers in the U.S.? I guess I'm just looking for what could be a tipping point of demand as it sounds like maybe there's more work to do on education. And then I also wanted to loop in Cristian here. I know obviously early days, but can you give us a sense of your priorities and maybe approach to development for a diversified portfolio like Bristol's?

A: Yes. Thanks for the question. So we're pleased with the progress that we made in Cobenfy's first full year on the market, and we're establishing a new treatment paradigm in what we knew was going to be a highly entrenched market. As you have probably seen, we've now surpassed 2,400 TRxs on a weekly basis, and we expect to see continued steady growth. We are adding a significant number of new trialists each week. Physician feedback continues to be positive regarding Cobenfy's profile, and we're very pleased with the kind of the pace of access that we're able to establish early on. As you know and as a reminder that this is a heavy Medicare, Medicaid population. And so we have virtually 100% access across both. Now stepping back, there's clearly more work to do in year 2. We need to continue to increase both breadth and depth of prescribing, which will drive additional growth for the brand. We've onboarded our expanded field force now in the community and in the hospital setting. And so based on the leading indicators that we're seeing, Cobenfy is going to deliver continued steady growth in schizophrenia and longer-term growth is going to be fueled by additional indications, as Cristian has stated, and that's what we've also seen with other antipsychotics in the market. But we are confident that Cobenfy will be a big drug over time. Cristian?

Q: I want to touch on the competitive landscape for the PD-L1/VEGF bispecific. So we saw some data at ESMO with PFS benefit in the HARMONi-6 trial in squamous non-small cell lung cancer. Can you just help frame how that maybe informs how you're thinking about your partnership with BioNTech? Does it make you more incrementally confident? Or is it really too early to read into kind of your program?

A: Thanks, Evan. Let me just say one thing about BioNTech, and then I'll turn it over to Adam. That partnership continues to go very well. We have a very tight relationship with BioNTech, both on the development side and of course, anticipating the commercial opportunity on the commercial side. And so far, that relationship is quite strong. But Adam, do you want to go through the details?

Q: So I wanted to come back to Cobenfy and not trying to read too much into the prescription data over the summer relative to earlier this year. But I did want to ask about how you're thinking about potential or key barriers to adoption thus far? Is it GI tolerability? Is it twice daily dosing? Is it just prescriber inertia in terms of the dominance of the D2 blockers? Just wanted to get a better sense of what you're hearing and seeing in the field and what you think you need to do to drive more acceptance of the product among psychiatrists.

A: Yes, David, I appreciate the question. So as I said earlier, we're pleased with the progress that we've made. We're now just about a little over one year in the market right now. And this is an entrenched market as we know that. This is the first new mechanism that's been approved in over 3 decades in the space. And so I think what's really important, what we look for in terms of leading indicators are adding new trialists, and we're tracking very well on a weekly basis as well as new prescriptions. When we look at the feedback, in general, the feedback is very positive regarding Cobenfy's profile, as Chris mentioned. I would say that the #1 question that we get as a team is around how to switch from a D2 to Cobenfy And even from physicians who are sitting on the sidelines, that's the question they want to know. And so we've got robust peer-to-peer activities that are ongoing. We've introduced real-world data, and we have a Phase IV switch study that reads out early next year, all will help build physician confidence. What I will say is if you look historically, all the recently launched D2s, we are tracking ahead of all recently launched analogs in schizophrenia. So based on everything that we're seeing, we feel good about the performance for Cobenfy. We're going to continue to see steady growth and the inflection will come as we continue to add new indications.