Save This Page“Future Grim for Bristol Myers Squibb”
08-Aug-06
Bristol Meyers Squibb is a company in transition to be sure. Earnings have been eratic and down in recent years. They are losing exclusivity and experincing slumping sales in many - if not most of their major drugs.
Pravachol (cholesterol lowering agent), their 2nd biggest seller, lost exclusivity in April and 2005 sales were off 14%. Coumadin sales dropped 17%. Their anticancer drugs TAXOL and parplatin were down 25 and 77%.
If that’s not enough, the drug maker received a sock in the gut when Apotex announced it will start to sell a generic version of Plavix, Squibb’s top seller ($3.8 billion in 2005). Exclusivity for Plavix isn’t set to expire until 2011. Of course there’s on-going litigation and so forth, but thing’s aren’t looking so good now.
To their credit Bristol Meyers has realized that they will take it on the chin this year and have shifted focus to developing their pipeline. They’ve increased R&D by over 11% per year over the past three years. They’ve introduced six new drugs in the past 3 years and are focusing on large global markets such as HIV and hepatitis, which in the long term should be extremely profitable.
Look for the stock to get beaten some more this year. But when the ship is righted BMY will present a great buying oportunity.