I'm Geoff Meacham. I'm the senior biopharma analyst, and I have Charlie from my team on stage with me as well. Welcome to the Bristol Myers session. So on behalf of Bristol, we have CFO David Elkins. David, welcome.
It's good to be here. Thank you for having me.
Yeah. So let's, we got a lot of questions, but maybe just kick it off, kind of post, you know, Q1, like the messages coming out of that, and then we'll get right into some pipeline and portfolio questions.
Yeah, no, thank you for that. And, you know, if you think about Bristol, we're really, you know, writing the next chapter in the company's history here. 150 years that this company's been around, some amazing products that we brought to the marketplace, whether you think about Abilify or Plavix in both, neuroscience as well as cardiovascular. But really what we're focused on is delivering the here and now and executing against what we have from a, you know, growth portfolio. Really excited about some of the products we have there. We recently brought in, KarXT from Karuna, which we can talk about in Q&A. But, we got great growth products, which I'm sure we'll cover off, whether we're talking about Opdualag or cell therapy franchise, but also Camzyos and cardiovascular and, and Reblazyl within, MDS.
We're really excited about that and continue to grow those products. We can talk about the growth of those in the first quarter, but also how we're seeing it as the year progresses. Pipeline, we got a lot of really exciting things coming through the pipeline. A few catalysts over the next couple of years, which we can cover off as well. And then you may have... We talked on the first quarter call. We're really focused on driving efficiency and effectiveness, simplifying our business model, removing layers in the organization to speed decision making, but also being able to free up resources to invest in our portfolio.
You know, we brought in with the four acquisitions that we closed in the first quarter that we have, you know, significant clinical development programs that we need to execute against, both from KarXT, but as well our RayzeBio acquisition. We're really excited about, you know, that has the potential to be a significant IND engine and one of the fastest-growing areas in oncology. Mirati, you know, we launched Krazati, but also we have a robust clinical program there with doublet and triplet therapies in first-line lung, which you can talk about, and we also have PRMT5, which we'll get some data on as well.
Really a lot to be excited about as far as the portfolio, both the growth portfolio, but as well as the pipeline, and our priority is just executing every quarter against them.
Makes sense. Yeah, let's, before we get into the new launches, I wanted to kind of ask you, your, you know, the... I know you guys haven't given formal guidance for, you know, kind of the Eliquis, you know, the IRA impact and, and trough, but maybe give us a framework for how potentially to think about, you know, the next, say, two years or so. The launch portfolio, I think, at the end of the decade, is gonna really drive differentiated growth, but the investors are, you know, focused on the next, say, 12, 18 months. So whatever you can do to kind of help, help, give us some context for that.
Yeah, look, we reaffirmed our guidance in the first quarter call that we're gonna-
Yep
... continue to grow this year, and we anticipate growing in 2025. You know, we really can't say anything about the IRA negotiations 'cause we're precluded from saying anything around that, but that price will become public, you know, in September. And what we said is, we'd provide, you know, what the impact of that was to our business in 2026 and 2027, you know, from a revenue and an EPS perspective. And that should give you know, investors a really good understanding of, you know, how IRA is gonna impact the shape of our business.
Makes sense. Okay, when you look at the core Opdivo business, so there, you know, there have been some, you know, some drivers, esophageal, new, new indications, as well as kind of earlier lines of therapy. You know, thinking about the next, say, you know, 12-24 months, investors focus a little bit less on this, but it is, you know, a big driver of, you know, bottom line in particular. So what would you say are the, are the biggest, you know, kind of growth engines for, for that franchise?
Yeah, look, we feel really good about Opdivo and it continuing to grow. It grew close to 10% last year, and we said it'd be more modest growth this year because we just don't have as many new indications coming out this year. We had the neoadjuvant and obviously peri-adjuvant. But what we said is, you know, we had some destocking that occurred in the first quarter of the year, but as we look at the growth potential of the product, it's gonna continue to grow this year and into next year. So we feel really confident about that.
Yeah, perfect. Well, let's talk through the new launches. So that's the most exciting part of the, you know, the, of the Bristol story. You have, Reblazyl, which, you know, in the earlier stage, anemia, you know, is just now gaining traction. Walk us through the next, say, you know, 12, 24 months in terms of what the drivers are gonna be. I'm sure it's all the above, but is it mostly, you know, line extensions in US? Is there a geographic kind of, rollout as well that could contribute?
Yeah, so let me just walk through all of them first.
Yep.
You know, I'll start with, we talked about Opdivo, but also I'd be remiss if I didn't mention that we have the PDUFA date for our subcutaneous formulation-
Yep
... with Opdivo, and we believe, you know, 30%-40% of the business will go into subcutaneous formulation with physicians. And there's a high on that need. The great thing about that is we're, you know, we have the PDUFA date in February of 2025. Opdivo doesn't go generic in the US until December of 2028, so we have 4 years to bring that over, and that could be very complementary to the growth profile of the company. The other thing is Opdualag, which is, you know, Opdivo is a component of Opdualag, and we had some really positive data come out in first-line lung on Opdualag. And we're also later this year we should see some data on liver as well.
So the ability to move Opdualag, we've been really pleased that it's now the standard of care in first-line melanoma. But with additional indications, we'll get, you know, more data later this year on more lung at a conference, and we're looking at moving that into phase III. So feel really good about the near-term potential of Opdualag continuing to grow, but as well, longer term, it's gonna be a really important product to our portfolio. The next one I'd really focus on is Reblazyl. I mean, it's just doing phenomenally well, grew 70%. We got a broad first-line indication, RS positive, RS negative. We're only about 25% penetrated in that market.
You know, and also I think it's really important geographically. See plenty of expansion coming there because we've got a broad label in Europe as well as in Japan. So continue to look at that product do very, very well. I guess the next area that I'd go to is talking about our cell therapy franchise. We made. You know, our focus on execution, we've made great strides in our manufacturing capacity. We're unconstrained from a manufacturing capacity. We're really excited about Breyanzi. We already got two indications, SLL and CLL, you know, earlier this year, and we have two more indications, Mantle cell lymphoma coming, as well as follicular lymphoma coming later this year. So we see Breyanzi being a critical growth driver for the company.
We did get an earlier indication of Abecma, but that, you know, that market remains very challenged and competitive.
Yep.
But we said overall, as you think about that cell, our cell therapy franchise, Breyanzi is gonna be a significant growth driver of the business. You know, the area that, Camzyos would be the next one I would talk about. We've been really pleased with this. We think this is gonna be on track to be one of the most successful cardiovascular launches. You know, and this, this is a, this is a new class, so it takes time to build up-
Yep
... this. You're also limited by patients have to go through echocardiograms. A lot of those labs are full to begin with, but we've been really successful in getting excitement around this product. High unmet need. You know, these patients actually feel the benefits of the drug when they get on it, and what we're seeing from a long-term safety profile is people are staying on this medicine for a very long time. And, you know, so we're really excited about that. I mean, we have a world-class commercial organization, you know, in our cardiovascular business with the success of Eliquis, but now, you know, continuing to drive Camzyos, and then we got another catalyst coming with Milvexian phase III data coming in 2026.
So we feel really good about the cardiovascular franchise and the growth products, and I'm sure we'll talk about the pipeline a little bit more. You know, the area that, you know, has been hasn't been meeting expectations is immunology. That remains, you know, a challenge business for us. I think it's taken us longer to get access than we were anticipating. The quality of that access hasn't been what we wanted, and as a result of that, you've been seeing that, you know, come through, you know, not just on Sotyktu, but also on Zeposia.
Yeah.
We think there's gonna continue to be pricing pressure, particularly from our rebating, 'cause we're seeing competition there, not just from Otezla in the oral market, but you're also seeing competition from the biologics as well. So, you know, as we're looking at that business, we're looking at it as a double digit, you know, about 10% growth, Q1- Q2 sequentially for Sotyktu and Zeposia, and Orencia, you know, is probably gonna be a single-digit sequential growth for Q2. So, and as we also said on the call, remember, as we're thinking about Sotyktu, we said we're roughly doubling that business from Q1- Q2 in the commercial business. So we need to continue to improve upon our market access for Sotyktu to be competitive.
We will be moving from 1 step edit to 0 step edits on ESI, so, that'll help the position, and as we said on the call, we're gonna get another large PBM with about 30 million lives later this year, so that will also help, which, you know, that gives us, you know... Once we get on more of that equal footing, that gives us the ability to continue to grow that into next year and beyond.
Right.
We also have phase III data coming out on psoriatic arthritis for Sotyktu, which, you know, there's about 25% of psoriasis patients have psoriatic arthritis, so I think that's gonna be another driver, and then we're gonna get phase III next, second phase III on psoriatic arthritis that will help Sotyktu the following year.
So I guess, you know, several products have been talked about here, and I think we can probably go into each one of them. But maybe just start with cell therapies. So Breyanzi, you know, you mentioned that that's gonna be kind of like the growth driver, but I guess just kind of looking across kind of multiple, you know, cell therapy players, you know, they've seen some pressure, you know, last quarter, maybe even this quarter. I think some of them say that the inflection will take probably a little longer, maybe second half of the year, but maybe you can talk about kind of what you're seeing from your side in terms of the competition, you know, whether that's coming from the bispecifics or from the clinical trials, and whatnot.
Yeah, it's a really good question, and you really have to bifurcate Abecma and BCMA versus CD19 and Breyanzi 'cause the dynamics are very different in those two markets. I would agree with you as far as the competitive environment in BCMA with Carvykti and as well as the bispecifics that are in there. We see that it's gonna remain very competitive, and that's why, you know, we think the growth will be more muted with Abecma. But Breyanzi, you know, we believe, you know, we got a best-in-class molecule here, very safe. We're moving into the community settings, but more importantly, you know, there's still a high unmet need in lymphoma, you know, in getting those indications, as I was saying earlier, in CLL and SLL, but then mantle cell lymphoma and then follicular lymphoma.
That's, that's a huge patient population that we're now gonna be able to address. And, you know, from a supply perspective, we're unconstrained. We've continued to improve, you know, our effects, you know, focusing on the execution and from a supply chain perspective. We've had a manufacturing facility in Massachusetts. We're building a manufacturing facility in Leiden. And one of the other constraints is vector supply, and last year we announced the purchase of a Libertyville site, where we're gonna be doing suspension vector, which will further, you know, strengthen the supply of the cell therapy business.
The other thing we just announced as well is our partnership with Cellares, where that's gonna be an automated manufacturing process, which will increase the, you know, success rate coming through, so the throughput, but it also will shrink the turnaround time, and we're really excited about that partnership with them, and that's gonna be another thing that will help increase the long-term supply of, you know, Breyanzi. So remain really, really excited about the long-term potential of that product.
How are, like, the community kind of settings, kind of, kind of what's the plan that you guys are doing in terms of driving that area of growth?
Which, which one, sorry?
The community settings for Breyanzi.
Yeah, I mean, you know, the additional indications?
In the additional indications, but just kind of in terms of just given kind of where we're seeing in terms of the constraint, you know, within the academic centers.
Oh, I, you know, I think, look, this is, this is a huge unmet need, and, you know, we believe that those constraints for Breyanzi aren't gonna be there because these patients don't have many other treatment options, and, and they'll, you know, they'll get prioritized in that regard. So we feel pretty good about the prospects of Breyanzi, even with those constraints, given, given the types of diseases and the high unmet need for these patients.
Yeah, David, just to follow on that, when you look at cell therapy as a, you know, as a platform for, you know, for Bristol in general, I mean, the... You guys are investing in new indications and line extensions, et cetera, but maybe talk through the commercial piece of it. Are you starting to see, you know, more leverage, you know, easier access, you know, from a pricing, reimbursement kind of perspective, and I think going forward, is that, you know, is that going to get meaningfully better or sort of is it incremental where we are now?
Yeah, we believe it'll continue to improve. I mean, this is a, as we were saying, this is a high unmet need if you think about the therapeutic areas that Breyanzi is going in there, and we don't see that as a constraint for this product, going forward. So, you know, I think the... Yeah, that's what I would say.
Okay, perfect.
We feel really good about the access.
I wanted to ask you, so you mentioned with respect to the Opdivo LOE and the way to manage it, and I think most investors, you know, don't look at that as a more shallow-
Mm-hmm
... you know, kind of a kind of erosion curve, and particularly since, you know, Opdualag could be a big, you know, a big offset there. Walk us through kind of, you know, how you're thinking about that in the outer years. You know, what is the menu of where Opdualag could go, you know, beyond lung and beyond melanoma? And is that the bigger driver, or are there other combinations, formulations that you guys are thinking about at the end of the decade and beyond?
Yeah, sitting here today, it really is focused on Opdualag and moving that into other tumor types.
Yep.
We see continued growth there. Obviously, the subcutaneous is gonna be important. You know, if you think about through the physicians, you know, those infusion chairs are, you know, jam-packed right now.
Yep.
So to create capacity for the healthcare system overall is gonna help that. But, you know, sitting here today, as far as combinations are concerned, Opdualag is the main one that we're focused on. Now, you know, we have, you know, other... As you think through, as I was talking about earlier with Mirati, and looking at the combinations there with KRAS, you know, we think there's multi-billion-dollar opportunities there in doublet as well as in triplet therapies in first-line lung. So you look at the oncology portfolio overall, and then, as we were talking about earlier, just coming back to RayzeBio and radioligand-
Yeah
... we think there's an untapped potential there. It's a huge market, and, and this, and just given the mechanism of action, given your ability to see the, you know, the drugs being delivered to the tumor type, you know, getting those products approved is, you know, something we're also really excited about.
Yeah.
That it's gonna be multiple IND engines and multiple tumor types.
Yeah, makes sense.
So maybe on Camzyos, right? I think, you know, we heard some kind of incremental updates from competitors kind of this past weekend. Maybe any kind of latest thoughts that you guys have in terms of the, kind of the overall kind of market or the potential kind of competitive landscape over the-
Yeah, it's a great question. We actually held a ad board after the data became public on Monday, and, you know, the takeaway from the key thought leaders was that, no real clinical differentiation with the product, or from a safety profile. Remember, we just shared at ACC real-world data on the safety profile in Camzyos, and I think as well as the proof is in the practice, that once patients go on Camzyos, they're staying on Camzyos, and the days... Duration of therapy is continuing to extend with that, and we're continuing to build a lot of data, real-world data on that, which we will continue to engage with the FDA on as far as the safety of it.
But, you know, similar to what we saw with Eliquis, the more real-world data you have from a safety perspective, it just strengthens the profile. So we believe between the efficacy and the safety profile of Camzyos, it sets a really high bar for any competitors that are coming in. Now, we launched this product a couple of years ago. We're gonna continue to build as we move into new centers of excellence, but as well as move into the community setting. And remember that we have the same sales and marketing organization that, you know, made Eliquis number one. We got a real opportunity here to make Camzyos the product of choice in this new really important market.
I think, you know, having a competitor market as well coming in, you know, helps from the standpoint of increasing, you know, patient awareness and having somebody else out there. You know, it longer term is gonna be good for patients.
... We just want to follow up on that. When you think about the speed of having an HCM, you know, diagnosis, are you seeing improvements in the diagnosis, the front end of it? Is there an ROI that you can be confident in, in your investments commercially to raise awareness of the brand and the indication itself?
Yeah, no, it's a great question, and we've been investing in DTC to raise awareness about the disease, but as well as Camzyos specifically. You know, we are seeing, you know, the rate at which new patients are starting is increasing.
Yep.
You know, so that's, you know, it's been increasing. It's, you know, probably over, well over 140. You know, month to month, you have some... Week to week, you have some variability, but, we see the very nice slope on that new patient starts increasing. As you get new centers of excellence, you know, on board, and you get new community centers on board, that'll help that rate-
Yep
continue to increase. So we feel really good where we are with Camzyos, and, you know, I think you're gonna continue to see that quarter on quarter, that, that product continue to grow. Like I said, once patients get on that, the way they feel, their quality of life, they're staying on the therapy.
Right. Right. No, I agree, though. It's not really a zero-sum game, though. I mean, sometimes having a, another competitor actually builds the, you know-
Builds awareness-
Yeah
-of the disease and gets people in there talking to their physician.
Yep. Let's switch gears to KarXT. So a lot of investors are looking to this, you know, this launch, as one that potentially could launch, you know, pretty quickly, just given the, you know, the awareness and the positioning and the novel mechanism. Give us your kind of high-level thoughts on that ahead of the PDUFA date?
Yeah. Well, first, we're really excited, and we've been investing heavily. Number one, we retained the majority of the people from Karuna, a really talented team there from a sales and marketing perspective, and the vast majority of those individuals we were able to retain. Prior to even closing the transaction, we went at risk and started hiring in the sales force. So, you know, we're actively doing patient support programs, patient access, but as well as educating, you know, physicians as well, and thinking about how switching patients from that are have an unmet need on atypicals and moving into, really, the first new therapy in schizophrenia in over a couple of decades. So all that market development's happening. That being said, you know, the PDUFA date is late in the year. This is really a 25 launch.
Everyone should be thinking about it as a 2025 launch. And then, as you think about 2025, there's a couple of things. There's a big Medicaid market, right? And there's some states, you know, less than 10, that will put you on formulary immediately. A lot of states, it takes about 6 months to get on formulary, and by 12 months, you know, we anticipate we'll probably be on 80% of the state formularies. So, you know, 2025 is gonna be a ramp year as you're building up that access-
Yep
-with the 6 and 12 months, and how people should be thinking about it. But the excitement of this drug is just phenomenal. When we meet with key opinion leaders, but then now, as we're broadening out, meeting with more psychiatrists, people just cannot wait because there's really a high unmet need for patients that are battling this disease. And then when we think about this longer term, we got, you know, phase three adjunctive coming, as well, which is gonna be huge, increasing the patient population there, where you can use this in combination with other products. But then also, another big opportunity is in Alzheimer's disease, both Alzheimer's agitation, which is really not much there-
Yep
... and Alzheimer's psychosis and, you know, we look forward to bringing the data on those phase three studies in a couple of years' time.
Well, I guess there are kind of several other kind of players now moving to the Alzheimer's agitation space as well. I mean, they're developing it. Just kind of what's your view kind of in terms of the, how that kind of market would potentially evolve?
Yeah, look, it's a high unmet need, and anybody that's the caregivers that are supporting Alzheimer's patients, you know, both psychosis and agitation, is a huge unmet need for those patients. So having something out there that addresses this, where there is nothing, is gonna have a big impact on the healthcare system overall and improve, you know, people's quality of lives, but as well as the caretakers. We'll see how other competition comes out there, but, you know, we feel really strong. We got to see the data play out. But, you know, as we said before, this is a really big opportunity for us. We see multiple indications that'll be multi-billion dollar, and we even see bipolar as an opportunity for KarXT as well, so...
Just in terms of the timeline of the readout, can you just remind us again on when we're going to see those kind of incremental indications?
Yeah, a lot of, a lot of those are. We got one phase 3 readout next year, and then there's another one in 2026.
Okay.
Just along those lines, sticking with KarXT, and you mentioned kind of the, you know, Medicare population. Just given atypicals are, you know, have been around for a while, I mean, is it reasonable to assume you're gonna see a lot of step edits, you know, within initially with the launch, ahead of a lot of the generic atypicals? And then there's a lot of enthusiasm for the class, and ultimately, the long term, you have a durable new mechanism. There's a lot of excitement, as you said.
Yeah. We, we don't see that. You know, we never want to prejudge, but we don't see that as a big, big barrier.
Okay.
I mean, there's nothing out there, right? And people cycle through these atypicals, but the side effects of these a-
Right
... atypicals is huge. And, you know, physicians are clamoring for something that's safe and effective, and they really haven't had anything yet to date. So, the push to get this on formulary is gonna be strong. But also, there's really no other choice beyond the atypicals now.
Right.
People, physicians naturally cycle through, so to cycle through a new therapy like this,
Yeah, makes sense.
You know, there's gonna be a lot of opportunity there.
Okay. So let's talk a little bit on, on, on Sotyktu, just in a, in a few minutes. You mentioned some of the dynamics with respect to, reimbursement access. Give us some, you know, some perspective that you, you, you know, you beat a, a competitor in a head-to-head. You have—It's a very, you know, competitive class, and there is still some dynamic between injectables and orals. And maybe give us kind of a, the, the drivers as, as you see them in the next, say, 12-18 months.
Yeah.
Is it mostly just execution, you know, getting better formulary or, or do you, you know, do you, do you expect other, you know, geographic rollout, like deeper penetration in your current accounts?
Yeah. The access is the most important.
Yeah. Okay.
Improving the quality of that access is what we're working on. You know, as ESI, we're gonna improve from 1 step edit to 0. That's gonna be a big help. And then getting another PBM with 30 million lives is gonna be also helpful. But we see pricing pressure remaining in that marketplace.
Yeah.
It's very competitive. You got the biologics, you know, coming in, moving into the more moderate space. And, you know, we got a significant competitor with, you know, Amgen and Otezla out there and, and getting access. But that's why we said, you know, this is gonna be a slower ramp than we'd originally anticipated and... But we're investing behind this. We're committed to making Sotyktu successful. We got the psoriatic arthritis, which will also help. We have two phase 3 data readouts coming. So, between the access and, getting the psoriatic arthritis, that, that'll help.
Yeah
... the growth trajectory.
Maybe just to kind of switch gear to kind of the KarXT, the NEX-T for the CD19, you know, CAR T-cell therapy for lupus. You know, I think that's been kind of a hot area, you know, over the past year, and I think there are some other players, you know, potentially with CD19, you know, antibodies approach. But just kind of think about kind of what do you think you know would be the right approach here, and how is kind of we think about this, kind of this market in coming years?
Yeah. Well, look, CD19, NEX-T, the construct is very similar to Breyanzi, so it's well known by physicians. The safety profile is, is well known, which is gonna be important for anybody entering this space. It's, you know, order of magnitude, significantly larger than hematology. You know, we believe we're at the forefront, of this and have one of the most advanced programs. We're gonna have some early data out later this year, but we see the opportunity that this could potentially reset the immune system in, in patients with lupus or, also, helping patients in multiple sclerosis, which, you know, is a significant opportunity. This, this is probably one of the biggest catalyst events that we have, you know, it being able to address, you know, autoimmune disease with cell therapy.
From a regulatory perspective, you know, kind of, I guess, how fast can you move once you see that phase 1 data into, you know, pivotal trial?
Yeah, we're gonna move as quickly as we can into that. You know, the, it's still early days. We gotta define all that, and we gotta engage with the regulators. So it'd be too soon for me to say, you know, how quickly that would be. Obviously, that's, those are conversations that you have to have with the regulators.
And just in the last couple of minutes, I want to ask you, David, just about you know, capital allocation, kind of BD environment. I suspect that, you know, de-levering will be an incremental component, but what, you know, what's the appetite for you know, for smaller. You know, do you see, is there still an ongoing process in smaller scale BD, and, you know, is it current therapeutic areas? Do you. Is there an idea that maybe you could further expand the breadth?
Yeah, it's good. I mean, look, we're really successful in closing the four deals we did in the first quarter.
Yep.
We gotta integrate those, build out the clinical development programs, and then launch KarXT. That's our focus right now. We're doing everything we can to make those successful and executing against those. So we think about capital allocation. Really, we're paying down the $10 billion of debt, you know, over the two-year period that we said. You know, we paid $3 billion in the first quarter with commercial paper coming down. We got about another $3 billion this year, $2 billion next year, and the rest of that is early 2026. That, that'll come through. And then, you know, types of deals that we're looking at, we're continuing to look at, they're gonna be smaller, bolt-on, technology deals or earlier stage-
Yep
... deals that'll continue to benefit the growth profile in the second half of the decade.
Gotcha. But still, you know, commitment to the dividend and all that.
Dividend, look, we've paid a dividend for 93 consecutive years. We've increased it for 15 years. We know the dividend's important from a shareholder return perspective, and we're completely committed to that. We're, you know, we believe our investment-grade credit rating is really important. We continue to engage with the credit rating agencies on that. Paying down the debt was, you know, part of that, just like-
Yeah
... with the Celg ene transaction, we paid down debt pretty quickly. We're looking to do the same thing with this, and we just think it's good financial health.
Makes sense.
With all the pricing pressures that are out there, tax pressures and everything, we think it's we wanna remain very financially disciplined, you know, in that regard.
Perfect. Okay, well, with that we're out of time. Thank you very-
All right. Thank you very much.