Good day and welcome to Bristol Myers Squibb's 2024 Annual Meeting of Shareholders. Today's virtual meeting conference is being recorded. We do not expect any technological difficulties. However, in the event we lose audio or webcast connection and we are unable to provide any updates, please wait 10 minutes for resolution. Please refer to the company's investor website for updates. Additionally, if you experience any technical issues viewing the videos during the meeting, this may be related to your internet browser, such as Chrome. Please click the Play button on the audio section of the media player or refresh your browser. If the problem persists, please call the 1-800 number that is provided on the meeting platform for technical support. At this time, I would like to turn the meeting over to Dr. Christopher Boerner, Chief Executive Officer and Board Chair. Please go ahead, sir.
Good morning. I'm Chris Boerner, Board Chair, and together with my fellow directors, I want to welcome you to our 2024 Annual Meeting of Shareholders. We value the opportunity to speak with you at our annual meeting to share our accomplishments with you and to answer your questions. Like last year, we've made arrangements for you to submit questions both in advance and at today's meeting itself in an effort to preserve these valuable interactions. Before we officially call the meeting to order, I'd like to extend my warmest regards to our shareholders who have long supported our vision to transform patients' lives through science. This meeting is now officially called to order. You should all see on the virtual meeting portal the agenda for the meeting. This is the same order of items we will be covering today.
With us today are all of the members of our Board of Directors who are up for reelection at this meeting: Ted Samuels, Peter Arduini, Dr. Deepak Bhatt, Dr. Julia Haller, Dr. Manuel Hidalgo Medina, Paula Price, Derica Rice, Dr. Karen Vousden, and Phyllis Yale. I would also like to acknowledge Jerry Storch, who is here with us today and will retire from the board today. We would like to thank Jerry for his 12 years of dedicated service to the company, its Board of Directors, our shareholders, patients, and employees. In particular, he served most recently as chair of our Compensation and Management Development Committee, bringing strong, independent leadership to the board and contributing greatly to enhancing the company's corporate governance and executive compensation practices. The Board is extremely grateful to him for his contributions. We wish him the very best.
We also have with us a number of members of the leadership team, as well as Jerry Ellis, our lead audit partner at Deloitte & Touche LLP, our independent, registered public accounting firm. I am pleased to report that we have a quorum of the company's common and preferred stock entitled to vote at this meeting represented virtually on this web portal or by proxy. Before we proceed with the formal business of the meeting, I would like to introduce our corporate secretary, Kim Jablonski, who will make one of our required legal statements before I provide a brief update on our company.
Thank you, Chris, and welcome, everyone. If during this meeting any statements are made concerning any projected financial or other forward-looking information, I refer you to the risk factors section of our most recent Form 10-K for a discussion of risks and other important factors that could cause the company's actual results to differ materially from historical or expected results. In addition, please refer to bms.com for a reconciliation of any financial measures we use that were not prepared in accordance with generally accepted accounting principles or GAAP. Chris, I turn the meeting back to you.
Thank you, Kim. We now turn to the company update, which has been prerecorded.
Now turning back to the formal business of this meeting. Kim, please proceed with the next agenda item.
Thanks, Chris. I'd like to confirm that we have a quorum present with over 86% of the company's common and preferred stock entitled to vote at this meeting represented virtually on this web portal or by proxy. You should all see the meeting procedures on the virtual meeting portal, which are available for download in the documents section of the portal. We ask that you please read and follow the procedures. On March 28th, 2024, the 2024 Notice of Annual Meeting and Proxy Statement, the proxy card, and the 2023 Annual Report were provided to the company's shareholders of record as of March 14th, 2024. These are available for inspection on this virtual meeting portal. We have received from Broadridge Financial Solutions a signed affidavit attesting to the mailing.
In addition, we've included on this web portal for shareholder inspection the minutes of the 2023 Annual Meeting of Shareholders held on May 2nd, 2023. Now, consistent with the company's bylaws, the board has appointed Carl Wagner as inspector of election for this meeting, including any adjournments. Carl is an employee of American Election Services, a professional services company specializing in independent tabulation and certification of voting results for corporations. Carl is with us today and has taken the required oath and presented it for filing with the records of this meeting. As outlined in the agenda, we have six proposals to vote on this morning. If you have previously voted, you do not need to vote again unless you wish to change your vote. After each proposal is presented, we'll refer to the board's recommendation as set forth in the proxy statement.
If any shareholder would like to make a comment regarding any of the proposals, please submit your comment through the web portal and note the proposal number to which it relates. Our board and leadership team value our annual meeting as an opportunity to hear and learn from you, our shareholders. Your input, as well as your investment, matter to us. After the voting, we will begin our general question and answer period. We kindly ask that you please hold your general questions and comments until that time. Chris, I turn the meeting back to you.
I now declare the polls open for voting on the items to be presented at this meeting and note for the record that it is May 7th, 2024, at 10:15 A.M. To ensure that there is sufficient time to address general questions, we ask that any questions or comments related to these voting items be limited to the specific item being presented as we consider the proxy proposals. Kim, will you please present the management proposals?
We will now move to the first item listed on the agenda, the election of directors. The nominees for directors and their biographies appear in our Proxy Statement on pages six through 10. All 10 directors will be elected for one-year terms expiring at the 2025 Annual Meeting. Are there any questions or comments on this item? There are no questions or comments on this item. We will now move to the advisory vote to approve the compensation of our named executive officers. As you can read in our Proxy Statement on page 93, we've taken a lot of care to craft compensation plans that combine our purpose and values with our strategy and operations. The Board of Directors recommends the shareholders approve this item. Are there any questions or comments on this item? There are no questions or comments on this item.
We will now move to the ratification of the appointment of independent auditors. The Board of Directors, on the recommendation of the Audit Committee, has appointed Deloitte & Touche LLP as the independent registered public accounting firm for the company for the year 2024 and is seeking ratification by the shareholders. The Board of Directors' position appears on page 95 of the Proxy Statement. Are there any questions or comments on this item? There are no questions or comments on this item. We will now move to approval of an amendment to our amended and restated Certificate of Incorporation. The Board of Directors recommends approval to amend the company's Certificate of Incorporation to provide for the elimination or limitation of monetary liability of specified executive officers of the company for breach of the duty of care. The Board of Directors' position appears on page 98 of the Proxy Statement.
The Board believes that it is necessary to provide protection to officers to the fullest extent permitted by law in order to attract and retain talent. This protection has long been afforded to directors, and this proposal to extend exculpation to officers as specifically permitted by Delaware General Corporation Law is fair and in the best interests of the company and its shareholders. Are there any questions on this item? There are no questions or comments on this item. I now hand the meeting back over to the Chair for presentation of the shareholder proposals. Chris?
Thank you, Kim. We will now move to the two shareholder proposals to be presented. We are pleased to welcome Mr. Glenn Beatty , who is representing the proponent for this proposal, Mr. Kenneth Steiner. Mr. Beatty, at this time, we turn the floor to you to please move your proposal. Operator, please open the line for Mr. Beatty.
Thank you. Proposal 5, independent board chairman, sponsored by Kenneth Steiner. Shareholders request that the Bristol Myers Squibb Board of Directors adopt an enduring policy and amend the governing documents as necessary in order that two separate people hold the office of chairman and the office of CEO. Whenever possible, the chairman of the board shall be an independent director. The board has the discretion to select a temporary chairman of the board who is not an independent director to serve while the board is seeking an independent chairman of the board on an expedited basis. It is a best practice to adopt this policy soon. However, this policy should be phased in when there is a contract renewal for our current CEO or for the next CEO transition.
The roles of chairman and CEO are fundamentally different and should be held by two directors, a CEO and a chairman, who is completely independent of the CEO and Bristol Myers. The job of the CEO is to manage the company. The job of the chairman is to oversee the CEO. A lead director is no substitute for an independent board chairman. A lead director can be given a list of duties, but there is no rule that prevents the chairman from overriding the lead director in any of the so-called lead director duties and ignoring the advice of the lead director. It is more important to have an independent board chairman when the stock price is falling. Bristol Myers stock was at 80 in November of 2022 and has dropped substantially to $43 today. Please vote yes, independent board chairman, Proposal 5.
Thank you. We share the high value placed on protecting the excellence and independence of our board. We have described in our Proxy Statement the many practices we have already put in place to protect this independence. The Board of Directors' position appears on page 100 in the Proxy Statement. Kim, are there any questions or comments on this item?
There are no questions or comments on this proposal.
I am now pleased to welcome again Mr. Glenn Beatty , who is representing the proponent for this proposal, Mr. John Chevedden. Mr. Beatty, at this time, we turn the floor to you to please move your proposal. Operator, please open the line for Mr. Beatty.
Thank you. Thank you once again. Proposal 6, executives to retain significant stock, sponsored by John Chevedden. Shareholders ask the board of directors to adopt a policy requiring the five named executive officers to retain a significant percentage of stock acquired through pay equity programs until reaching normal retirement age and to report to shareholders regarding the policy in our company's next annual proxy meeting proxy. For the purpose of this policy, normal retirement age would be about the age of at least 60 and be determined by our executive pay committee. Shareholders recommend a share retention percentage requirement of 25% of net after-tax shares. This policy shall supplement any other share ownership requirements that have been established for senior executives and should be implemented without violating current company contractual obligations or the terms of any current pay or benefit plan.
Requiring senior executives to hold a significant portion of stock obtained through executive pay plans would focus our executives on Bristol Myers Squibb's long-term success. A Conference Board task force report stated that hold-to-retirement requirements give executives "an ever-growing incentive to focus on long-term stock price performance." This proposal topic is all the more important at Bristol Myers Squibb due to the recent poor stock performance. Bristol Myers Squibb's stock has fallen substantially from $80 in November 2022 to $43 now. Additionally, there is commentary that Bristol Myers Squibb does not have a game plan for future growth. Sales from Bristol Myers Squibb's top three drugs, Revlimid, Opdivo, and Eliquis, are dwindling as they gradually go off patent, and Bristol Myers Squibb has no current item or promising pipeline replacements. There is also commentary that Bristol Myers Squibb is unwieldy and needs to sell underperforming divisions.
A more rigorous named executive officer stock retention plan could ultimately improve shareholder value significantly for years in the future. Please vote yes, executives to retain significant stock, Proposal 6. Thank you.
Thank you. The company's existing share retention policy, through its design, is robust, consistent with current market practice, and properly aligns the interests of management with the interests of shareholders while also ensuring the company has flexibility to attract and retain the top talent we need to execute our strategy. In addition, the company already prohibits all employees, including executive officers and directors, from engaging in any speculative or hedging transactions. I refer you to our board's position on this proposal on page 103 in our proxy statement. Kim, are there any questions or comments on this item?
There are no questions or comments on this item.
Any shareholder who has not yet voted or wishes to change their vote may do so by clicking on the voting button on the web portal and following the instructions there. Shareholders who have sent in proxies or voted via telephone or internet and do not want to change their vote do not need to take any further action. I will pause here for a moment to allow anyone who is still voting to submit their vote through the portal. Now that everyone has had the opportunity to vote, I declare the polls closed on the items presented to this meeting. For the record, I note that it is May 7th, 2024, and the time is now 10:24 A.M. While we wait for the vote to come in, we have a prerecorded video to share with you about our company.
I see the vote is now in, so we can announce the preliminary results. These totals are preliminary because the vote is subject to final audit by the Inspector of Election, but that will not affect the outcome on any matter. Kim?
Each nominee for director has received a for vote of at least 93%. Our advisory vote on the compensation of our named executive officers was approved with over 93% of shares voting for. The ratification of independent auditors was approved with over 96% of shares voting for. The approval of an amendment to the company's amended and restated Certificate of Incorporation to provide for limited officer exculpation was approved with over 61% of the outstanding shares voting for. For the shareholder proposal requesting a separate chair and CEO, approximately 32% of the votes were cast in favor, 67% were cast against, and 1% abstained. For the shareholder proposal on executive retention of significant stock, approximately 39% of the votes were cast in favor, 60% were cast against, and 1% abstained. Final voting results will be posted on bms.com and will be filed with the SEC within four business days.
That completes the voting tallies.
Thank you, Kim. This completes the formal business of this meeting. Thank you all. The meeting is adjourned, and we now will begin the general Q&A session. As I mentioned earlier, we have our board and a number of my leadership team members present who will also be participating in the question and answer session. With us today are David Elkins, Dr. Samit Hirawat, Adam Lenkowsky, Sandra Leung, and Amanda Poole. Now we would like to open things up for shareholder questions and comments. We will begin with questions that we've received in advance of today's meeting. We will then take shareholders' questions that are being entered today on the web portal. Please note that we will attempt to answer as many questions as we can, focusing on those questions that are pertinent to the matters in the agenda.
We will not address questions and will stop discussions that are irrelevant to the business of the company, require discussion of matters viewed by the company as confidential, relate to personal grievances, are references to individuals, are disrespectful, or are not a matter of interest to shareholders generally. Any appropriate questions or topics we do not get to will be addressed on our company website. Kim, can you please read the questions we have received from our shareholders?
Thank you, Chris. Our first question comes from Harish Saraiya. On the proxy vote card, can you make one more option to allow shareholders who want to give all directors a yes vote be able to mark one box showing all?
Thank you for the question. While we understand the desire to include a vote-for-all option, we believe a choice to vote yes or no on each individual director is more aligned with our majority vote standard for the election of directors. We appreciate your feedback. We will continue to evaluate which voting options are permissible and most desirable based on current regulations and our corporate governance documents and make appropriate changes as needed.
Thank you. The next question comes from Rusty Carr. Do you donate to election deniers?
We are a company that is guided by our strong values. Each of our contributions is vetted and approved by the BMS Political Action Committee Board of Directors. Contributions are made without regard for the private political preferences of our executive officers. Our political giving is guided by a set of criteria based on candidates who support innovation and enhance our ability to meet the needs of our patients. We make the criteria and our contributions public on bms.com. We evaluate policies and legislation independently as aligned with our values, and we will engage on policy issues related to innovation and the needs of our patients and employees. We recognize that candidates may take stances on multiple issues and that their views can evolve. We regularly evaluate our giving strategy as we strive to ensure our advocacy work advances access, innovation, the patients we serve, and our employees.
Thanks, Chris. Our next question comes from Robert Humes. Why has the stock price plummeted in the past 12 months?
Thank you for the question. As I stated in my business update remarks, we are writing a new chapter of our company's history. Right now, my focus is squarely on executing our plan to drive long-term growth. I've been in this role for six months now, and as we talked about when I assumed the CEO role late last year, I've been concentrating on three key areas: execution, driving commercial performance across our diversified portfolio, our pipeline, continuing to advance our rich pipeline to serve more patients around the world, and transformation, repositioning our portfolio to strengthen our long-term growth profile while changing our culture. Since then, we have moved quickly on M&A and business development. In the first quarter, we closed four strategic transactions that added new, promising assets to our business, and integration is going well.
We are also taking decisive action to become a more agile company to maximize shareholder value. We are prioritizing pipeline assets with meaningful growth potential, reducing costs by approximately $1.5 billion by the end of 2025, and largely reallocating these savings to accelerate innovation and strengthen our growth drivers, streamlining decision-making, and reducing management layers. While we have more work to do and are early in our transformation, we're making good headway and are confident in our ability to deliver attractive long-term growth, and over time, this should be reflected in our share price. This process will not yield results overnight, but we are moving with urgency and are committed to getting it right.
Thanks, Chris. Our next question comes from Ronald Zowski . Have there been any talks about buying any other drug companies?
Business development, paired with R&D and enabled by strong global capabilities, is core to driving our innovation engine and future growth. We look at deals that are strategically aligned to our business, have the potential to accelerate transformational science, and are financially disciplined. We seek deals that are aligned with our therapeutic areas of focus where we see high unmet need for patients. Going forward, our overarching approach to business development will be to focus on licensing, partnerships, and bolt-on acquisitions. Our specific focus will be on earlier-stage assets where returns can be more meaningful and on assets that can enhance growth in the last few years of the decade in areas where BMS can lead.
Thanks, Chris. The last question we've received comes from Leo Saint-Amour. How many shareholders and guests are present at this meeting?
There are 26 shareholders and over 40 guests present at this meeting, and that is the last question so we can close out. Thank you for all of you for joining us today for our 2024 annual meeting. We appreciate your participation and value hearing directly from you, our shareholders, and we look forward to your continued support.
This now concludes the meeting. Thank you for joining, and have a pleasant day.