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spk03: Good day and welcome to the Bristol Myers Squibb 2021 first quarter results conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr Tim Power, Vice President, Investor Relations. Please go ahead, sir.
spk04: Thanks, Keith, and good morning, everyone. Thanks for joining us today for our first quarter 2021 earnings call. Joining me this morning with prepared remarks are Giovanni Coforio, our Board Chair and Chief Executive Officer, and David Elkins, our Chief Financial Officer. Also participating in today's call for Q&A are Chris Berner, our Chief Commercialization Officer, and Sumit Hirawat, our Chief Medical Officer and Head of Global Drug Development. As you'll see, we've posted slides to bms.com that you can use to follow along with for today's remarks. But before we get started, let me read our forward-looking statement. During this call, we'll make statements about the company's future plans and prospects that constitute forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors including those discussed in the company's SEC filings. These forward-looking statements represent our estimates as of today and should not be relied upon as representing our estimates as of any future date. We specifically disclaim any obligation to update forward-looking statements even if our estimates change. We'll also focus our comments on our non-GAAP financial measures, which are adjusted to exclude certain specified items. Reconciliations of these non-GAAP financial measures to the most comparable GAAP measures are available on BMS.com. Giovanni.
spk18: Thank you, Tim, and good morning, everyone. Let me start by saying that I'm proud of our continued strong execution during a global pandemic and the significant progress we are making against our strategy. I want to recognize and thank our global employees for their hard work and resilience through this challenging time. Now turning to slide four. At the start of the year, I laid out our strategy to grow our business and renew our portfolio through the end of the decade. During the first quarter, we delivered strong results consistent with this strategy. We successfully grew our revenues, launched new medicines and new indications for IO, and continued to advance our pipeline. Starting with our financial performance, Our revenue grew 3% despite the impact of COVID-19 related buying patterns in Q1 of last year. Our quarter was strong for sales and EPS in the context of COVID related dynamics for some of our products. Based on continued strength in our business, we are affirming our full year non-GAAP guidance for 2021. The accelerated renewal of our portfolio advanced across all four key therapeutic areas. Through regulatory approvals and clinical readouts, we're building a more diversified, younger portfolio that will fuel our growth through the decade and beyond. Although there remains uncertainty with how the COVID recovery will evolve, we are actively planning to return colleagues to the workplace. and are prioritizing plans to fully bring our sales reps back in the field where conditions allow to further support our inline products and launches. Let's turn to our execution scorecard on slide five. I am pleased that we've already made solid progress across the board during Q1. Specifically, in oncology, Obdivo is the first and only IO agent with a first-line approval in gastric cancer. Combined with our opportunities in metastatic and adjuvant esophageal cancer, Obdivo can become the leading IO medicine for patients with early and advanced GI cancers. We have strengthened the growth and long-term sustainability of our IO franchise with a positive Phase III clinical trial for Relaclimab. We're now the only company with three proven IO mechanisms. Building on our leadership position in melanoma with the Opdivo plus Yervoy regimen, we've now demonstrated a clinically meaningful PFS benefit on top of PD-1 monotherapy for a second IO agent, which is a great accomplishment knowing the high efficacy of PD-1 monotherapy in first-line melanoma. This is great news for patients with advanced melanoma, and we look forward to presenting the data at ASCO in June. Beyond IO, six of our eight near-term launches are now successfully underway. In hematology, we made great progress in our cell therapy franchise with U.S. approvals of Brianzi and Abecma. Our other new product launches are also progressing well. A lot is happening in immunology. we presented Phase III data for Ducrava, which we expect to file later this year. We see this as an important medicine for patients and the company with significant revenue potential. As you know, Ducrava is a first-in-class selective TIK2 inhibitor with the potential to become the new oral standard of care in moderate to severe psoriasis. It also has broader potential to treat diseases such as psoriatic arthritis, IBD, and lupus. In our mid-stage pipeline, we initiated the Phase III study for Sendakumab in eosinophilic esophagitis. And in CV, we filed Mavacamten with the FDA and have a PDUFA date of early next year. Given the potential for our early stage pipeline with multiple assets across therapeutic areas and modalities, including protein homeostasis, cell therapy, and next generation biologics, we are planning a more in-depth session with you sometime in the fall to update you on the progress within our pipeline and how that further supports the long-term potential of the company. Now, turning to slide six. Our team's execution as a new company so far has been remarkable and reinforces my confidence in our ability to capitalize on the potential for future growth. We remain focused on growing our business between 2020 and 2025. More importantly, we expect that in 2025, our LOE products will constitute less than 10% of our business. with roughly one third of our continuing business coming from our launch portfolio. We believe our new launch portfolio has significant potential with 20 to 25 billion of non-risk adjusted sales potential in 2029. And this does not include the potential medicines that could come from our mid or early stage pipeline. To close, I'm confident we have established a strong foundation for our future growth. The strength of our execution, promising launch opportunities ahead, the breadth of our pipeline, and strength of our balance sheet positions us very well. I will now turn it over to David to walk you through the financials. David?
spk14: Thank you, Giovanni, and thank you all for joining our call today. I'd like to start with our strong top-line performance on slide 8. Our continued sales growth of 3% was driven by strong operational performance. When excluding approximately $500 million of COVID-related buying patterns we experienced last year, underlying sales growth was strong, up 8% or 6%, excluding the benefits of foreign exchange, as our teams continue to execute very well while operating in a mostly virtual environment. I'll now provide additional color on the performance of our key brands and new launches, starting with Eloquist on slide 9. This is another strong quarter for Eliquis as global sales were up 9% despite the unwinding of the fourth quarter inventory bill and the approximately 350 million COVID-related bill we experienced this time last year. In the U.S., first quarter sales increased 8% versus prior year, driven by strong demand with total prescriptions up 11% due to the strength of our position as the number one NOAC. First quarter sales also included the impact of a one-time true-up of approximately $160 million related to the Medicare coverage gap. As we look towards the second half of the year, we expect similar dynamics from the coverage gap as we've seen in prior years. We remain optimistic about the continued growth opportunity for Ellaclis since we've seen both new-to-brand OAC volumes return to pre-pandemic levels, as well as accelerated switching from warfarin. Internationally, Sales remain strong, growing 11% versus prior year. Eliquis continues to be the number one NOAC in multiple key markets internationally, with significant room to grow. We remain very pleased with the execution of Eliquis around the world and expect to continue to grow Eliquis share within a growing class. Now turning to Opdivo on slide 10, as it relates to the first quarter performance in the U.S., first-line lung shares remained in the low double digits within the IO-eligible population. The launch of our Opdivo plus Cabo indication and first-line renal is going well and further builds on our strong position in that space with significant uptake in the unfavorable segment where Opdivo plus Yervoy is not indicated. Though we did see some impact from COVID during the quarter as the resurgence of the virus earlier in the year impacted offices and infusion, we remain very confident in Opdivo's return to growth this year. Further supporting this growth, we are also very pleased with the recent approval of Checkmate 649, as Opdivo Plus Chemo is now the first IO regimen approved in first-line gastric cancer. We look forward to launching additional indications in early-stage diseases across esophageal and muscle-invasive bladder cancers, which are expected to further contribute to our growth later this year. Additionally, we have multiple opportunities for future growth, including Checkmate 648, for treatment in first-line esophageal cancer, which we announced met its primary endpoints, as well as from other trials that we'll read out over time. Outside the U.S., sales were up 2% due to favorable effects of foreign exchange. We are encouraged to see strong adoption of new approvals and increased reimbursement, including the 9LA regimen in Europe and both 9LA and 227 regimens in Japan. These dynamics offset the second-line indications and the impact of COVID. Looking forward, we expect to expand the use of Updevo and several additional indications currently under review. All in all, we remain very excited about the growth outlook for Updevo. Moving to slide 11, I'd like to touch on our in-line multiple myeloma portfolio. In the U.S., revenue and sales are flat as growth is offset by the expected workdown of last quarter's inventory bill. We also saw the expected seasonality that Revlimid and Pomalyst experienced due to patients entering the coverage gap earlier in the year. Outside the U.S., we saw a 4% increase primarily from foreign exchange, as well as strong demand for triplet-based therapies, which offset the approximate $100 million combined impact of an inventory bill at a Nintendo last year. This resulted in a 1% increase for Revlimid globally. Global POMLIS revenues were up 8%. This was driven by overall strong demand from triplet-based regimens and use in earlier lines. Now we want to spend a few minutes sharing the progress we've made in the quarter on our recent launches on slide 12. Our launches contributed $145 million in sales in the quarter. Let's start with Revazil, which generated $112 million in the first quarter. We continue to be pleased with the launch and uptake in new patient starts. We continue to see the transition from initial bolus to underlying demand. And while this market has seen some COVID impact, we remain focused on continuing to drive new starts for patients earlier in their treatment journey. Our initial launches in international markets are going well, and we will continue to add markets globally over the course of the year as we receive reimbursement. Moving to Ziposia, where we continue to see good traction establishing the brand as the S1P modulator of choice in multiple sclerosis. Positive additional prescribing experiences are translating into repeat scripts, and we are also encouraged to see patients convert to commercial supply at a quicker rate than before. Beyond multiple sclerosis, we look forward to launching SUPPOSI in ulcerative colitis, with FDA approval expected at the end of May. Outside the U.S., we are pleased that SUPPOSI's MS launches in several markets and we will continue to secure reimbursement in additional markets as the year progresses. The marketing authorization application for ulcerative colitis also remains under review in Europe with approval expected toward the end of this year. Turning to Onurag, we continue to be encouraged by the launch, where our teams remain focused on establishing the profile as the first and only oral treatment to demonstrate an overall survival benefit in the first-line maintenance setting of AML. Physician feedback and awareness have been positive, and our focus remains on shaping and establishing Onurag in a new maintenance segment of the AML treatment paradigm, which we know will take some time. Outside the U.S., we recently received a positive opinion from the CHMP with approval expected this year. Turning to our newly established cell therapy franchise on slide 13, we are very excited to have launched two differentiated cell therapies for patients. following the recent approval of Brianzi in large B-cell lymphoma and Becma in multiple myeloma. First, regarding Brianzi, our best-in-class CD19. While we are early in the launch, messages around efficacy and outpatient utilization are resonating with high-aided awareness among CAR-T treaters. We have also been very pleased at the rapid activation of our treatment sites, as we now have approximately 55 sites activated with patients already aphorised and recently infused. And as it relates to BECMA, we're excited to have the first-ever BCMA CAR-T approved for patients with highly refractory multiple myeloma. Where we're just a few weeks into the launch, we're encouraged by the enthusiasm we're hearing from customers for the treatment. We also see a real opportunity for synergy from the combined execution of these two therapies as Abecma is able to leverage the existing and growing site footprint of Breonzi. For both these important new medicines, our priorities are expanding the site footprint through rapid account activation and maximizing our differentiated profiles while ensuring a seamless customer experience. Now, let me take you through a few items on the P&L on slide 14. First, as we've said, our gross margin will continue to be largely a function of product mix. In the first quarter, our gross margin rate was impacted by the strength of Eloquus in addition to foreign exchange. Operating expenses reflect continued MS&A investment in our multiple launches across various therapeutic areas. And as that relates to our tax rate, our effective rate in quarter was 16.8%, which reflects our earnings mix for the quarter. Now, switching gears to the balance sheet and our capital allocation on slide 15, our liquidity position remained strong. approximately $13 billion in cash and marketable securities, including strong cash flow from operations of nearly $4 billion in the quarter. Regarding capital allocation, business development remains our top priority for the company, and we will continue to evaluate opportunities that complement our internal innovation. With regard to our debt reduction this quarter, we've demonstrated our commitment to strong investment-grade credit rating by accelerating our repayment of debt via $4 billion tender and redemption. We are also committed to returning cash to shareholders through dividend and share repurchases. Recall that we increased our share repurchase authorization by $2 billion at the start of the year, and that we plan to buy back between $3 and $4 billion in shares this year. In the first quarter, we have already repurchased $1.8 billion toward that goal, and we will remain opportunistic as the year progresses. Now turning to our 2021 guidance on slide 16. Following this quarter's performance, we are reaffirming our non-gap guidance for the year, which reflects significant growth over last year. Our businesses have remained resilient, and our launch opportunities have come into fruition. Again, I'm pleased not just with the performance, but also with the considerable progress we've made in executing our launches and advancing our pipeline. I'd now like to turn the call back over to Tim and Giovanni for Q&A. Great.
spk04: Thanks very much, David. Keith, can we go to our first question, please?
spk03: Thank you. We'll now take our first question from Terence Flynn of Goldman Sachs. Please go ahead.
spk15: Great. Thanks for taking the question. It looks like the clinicaltrials.gov listing for your Factor XIa Phase II study in total knee replacement is now showing completion data this month. So just wondering if we could actually get data from that trial here over the near term. And then looking back at anoxaparin's rate of bleeding in this setting, it looks to be about 4% to 5%. So just wondering what level of differentiation there you're looking for. Thank you.
spk18: Thank you, Terrence. Good morning. Samit, I'll pass the two questions on Factor 11a to you.
spk10: Thank you, Terrence. Looking forward to the readout of the first trial in the total new replacement setting, which is testing the single-agent Factor 11a in the next couple of months as we look forward now. And also, as we've spoken before, the second trial will read out in the early part of next year as well. In totality, it will be the one determining factor to really ascertain whether truly the overall safety and, of course, what we can gain in terms of efficacy to define the plan as we move forward. So, more to come on that. I will not go into the specifics of what level of improvement we are trying to look for. Those are going to be defined with the differences that we see. But, again, we've said before, if we can produce another agent for prevention of clotting and thrombosis at the level that is similar in efficacy but better safety profile, that is what we're looking for and certainly looking forward to the data in combination with antipsychotic agents as well. Thank you.
spk04: Thanks so much. Keith, can we go to our next one, please?
spk03: We're going to take our next question. It comes from Chris Schott of JPMorgan.
spk16: Great. Thanks so much. Just two questions here. Maybe first, just maybe elaborate a little bit more in terms of LAG3 and its role in the market. I guess, should we be thinking about this combo mostly as a kind of monotherapy competitor, or is this something you think from an efficacy standpoint can stand up against an Updevo, Your Void type of combo? And then my second question was just a little bit more color on the Updevo adjuvant launches. As we think about kind of treatment rates and development of these markets, just a little bit more color of how do we think about the esophageal and bladder kind of ramps as we think about kind of this year. So are these big 2021 events or is this going to take a couple of years to really see the opportunity for those indications? Thanks so much.
spk18: Thank you, Chris. So first, on LAC3, let me share my enthusiasm for a fixed-dose combination, which represents really important data to validate a third immuno-oncology agent from the company. And let me ask Chris to give you his perspective on dynamics in melanoma and where that fixed-dose combination may play, and then give you insights into the uptake in adjuvant.
spk12: Yeah, thanks for the question, Chris. So let me start with Lag 3. So first let me say that we are very excited and pleased with the data readout that we've seen for the third IO that we have from BMS. The results are very encouraging, and I think seeing an enhanced activity on top of Avdevo and melanoma, that's a pretty high bar. And so we're excited about the opportunity to bring this to patients. In terms of where it fits, You remember the current landscape of first-line melanoma. Devo Urovoi represents about 35% to 40% of first-line melanoma. Approximately 30% of this market is still single-agent IO, and you've got another 30% that is non-IO. So we think there's a real clear opportunity here for us to drive the benefit of Relatlimib+. into that population. There's clearly a continued unmet need with physicians looking for additional options that have a dual IO-like effect, and we're looking forward to bringing that combination to patients as we work our way through the regulatory process. In terms of the adjuvant opportunities, again, this is going to be an important opportunity as we get into the latter half of this year and certainly as we look for the growth opportunities beyond 2021. You noted esophageal in the upcoming opportunity with bladder. We're very excited about those. With adjuvant esophageal, this is a substantial patient population with considerable unmet need. The treatment rates here are relatively low today, just given the lack of approved therapy. So we would anticipate that over time we'll be able to drive utilization both in terms of the patients who are being treated today, which is relatively small, and then improve treatment rates over time, much the way we did, you'll recall, in adjuvant melanoma. And we would expect a similar dynamic to play out as we launch in bladder cancer as well. And so very excited about those opportunities and look forward to seeing those launches play out in the coming months.
spk04: Thanks, Chris. Can we go to our next question, please, Keith?
spk03: Our next question comes from Seamus Fernandez of Guggenheim.
spk06: Oh, great. Thanks for the question. So I wanted to follow up on Chris's question as it relates to LAG 3. You know, I noticed as one of the ASCO abstracts, there's also an adjuvant trial that is supposed to report some data. I assume that this is just a single-arm trial, but What's Bristol hoping for in adjuvant melanoma in particular, as well as the planned acceleration of the non-small cell lung cancer opportunity? Just hoping that Samit could maybe opine a little bit or give us a little bit of visibility on where he sees LAG-3 kind of potentially fitting in on the lung cancer side. And then separately, just wanted to get a little bit of a better sense of your thoughts around the stroke, the SPPS trial with Factor 11, still first half of next year. And maybe you could just remind us of the opportunity that you see there. In our view, we think that could be a $4 billion plus opportunity that's really not reflected in expectations, but nobody knows this space better than Bristol-Myers Squibb, given your experience with Plavix. Thanks.
spk18: Thank you. Thanks, Seamus, and thanks for the question. So let me just say before I pass it to Samit to answer both of your questions that, you know, we really look forward to presenting the LAC-3 data at ASCO. I think it's going to be a great opportunity to show the strength of the data. And on Factor 11a, let me just agree with you. This is a space we know extremely well where we've demonstrated our ability to be successful with Plavix, of course, going back a few years and with Eliquis as we're seeing as we speak now with the current performance of Eliquis. Samit?
spk10: Thank you, Giovanni, and certainly very excited to see the data coming out. Great for the patients and certainly very happy with where we're going in the pipeline for LAC3 in oncology for BMS as well. Overall, the natural progression after seeing the data in the first-line setting of addition of Relaplimab on top of Mevo would be to go into the adjuvant setting, and that's where you're beginning to hear a lot more that we'll be progressing into a Phase III program in the adjuvant setting for this co-formulation that we now have as a fixed-source combination for Opdivo Plus. certainly more to follow as we look deeper into the data for the metastatic trial to gain more in-depth knowledge on the biomarkers as well as the long-term follow-up that will come from the current 047 trial that will continue to evolve in terms of our knowledge. Now, the second part which you asked is about the non-small cell lung cancer opportunity. Certainly excited to have started the early box generation trial as well as looking at the combination of NEVO plus Rilapidimab plus chemotherapy to see where we can take it. And that's the idea behind accelerating the enrollment in that trial. so that by the end of the year, we can initiate a Phase III program in that setting if we have tolerability that is demonstrated in that early trial that we're looking at. In addition to that, you'll continue to hear evolution of the data potentially in hepatocellular carcinoma that we're looking also to have some look into in the Phase II study, and that can open up additional indications as we look forward. Beyond that, in the SSP trial, yes, we are still looking forward to the readout in the early part of 2022. As I said earlier, there are two opportunities. Opportunity number one is to improve on the current anticoagulation paradigm with a single agent, and then opportunity number two is to expand the use of anticoagulants with a background therapy of antiplatelet agents And those are the two studies that together will form the basis of the clinical development plan that we are thinking through, whether it be the venous side or the arterial side of thrombosis.
spk04: Thanks, Philip. Can we go to the next question, please, Keith?
spk03: Thank you. Our next question comes from Tim Anderson of Wolf Research. Please go ahead.
spk08: Thank you. I have kind of a higher-level question on the PD-1 space. Can you just talk about your longer-term view on whether price competition in this category is kind of imminent or eventually will happen in developed markets, both U.S. and Europe. The space is clearly getting more crowded with both domestically produced P1s as well as those sourced from Chinese pharma companies. And while price competition usually is not a winning strategy, it might be the only lever lots of these other companies can pull And I think at least in China, as many have started to recognize the P1 category has become a commoditized class. So lots of folks are trying to figure out what precludes this from happening outside of China. Can you articulate your views here? Thank you.
spk18: Thank you, Tim. Let me ask Chris to give you our perspective on a really important topic.
spk12: Yeah, thanks for the question, Tim. We obviously think about this quite a bit. As we think about the number of new PD-1 entrants in the market, we really look at it on two dimensions. First, there's the competitive impact of having additional players on the market. Frankly, that's an area that we pay attention to, but we're a little bit less concerned about. We have considerable resources focused on planning around competition. We have a good track record of competing in these markets. And while we're always a bit paranoid of potential new entrants, we feel very good about our ability to effectively manage competition. The second dimension that we look at is the one you're raising, which is the risk of commoditization of a market. And the way we look at that is, commoditization, we think, requires two things. It requires a low-cost entrance, and it requires perceived interchangeability on the part of payers, providers, and patients. The risk of both of these things coming together likely varies, we believe, by geography, healthcare system, and maybe even by therapeutic setting, but we pay very close attention to this. In terms of the risk, we absolutely believe it's something that we need to stay on top of. It's, as you note, very dynamic. Currently, the areas where we see the greatest risk don't overlap with our largest markets, at least today. But we certainly have plans to address the risk as they become more tangible. The two things that I think we can continue to do that position us well against this threat are, first, continue to leverage the extremely broad data set that we have generated in IO to ensure that treatment decisions continue to be clinically driven, and then second, continue to rapidly bring new data and approvals to market such that we're constantly pushing forward innovation and changing the standard of care. But this is an area that's very dynamic, and we're paying close attention to it.
spk04: Thanks very much, Chris. Can we go to the next question, please, Keith?
spk03: Thank you. Our next question comes from Jeff Meacham of Bank of America. Please go ahead.
spk01: Hey, guys. Good morning. Thanks for the question. Just had a couple of quick ones. On your new launches highlighted on slide 12, what were some of the headwinds you saw for Robloxil this quarter? And what do you think could be the tipping point for Ziposia and Honorag for the current indications? And then the second question is with your cell therapy franchise, I know it's early, but just given the proximity, of the two launches, are there synergies that you're seeing just with respect to site activation or reimbursement, et cetera? Thank you.
spk18: Thank you, Jeff. Chris, why don't you go ahead. Let me just give you my perspective. I'm really excited with what's happening on the front of our launch brands. The profile of the medicines that you mentioned is very differentiated. We have strong labels. And what we are hearing from physicians is exciting in terms of the potential role that these agents will have in the marketplace. Let me just ask Chris to give you more insights into some of the launch dynamics you referenced, Jeff.
spk12: Sure. Thanks for the questions, Jeff. There's a lot there, so let me try to hit on each of these relatively quickly. So, Reblazil, we're very pleased, actually, with the continued strong execution of the teams and what we're hearing on Reblazil, and our expectations for growth this year and certainly in the long term remain unchanged. As for the dynamics that we saw in the quarter sales, we're relatively flat Q4 into Q1, and there were really two factors that underlying this. First, as you will have heard from some of our peers, we have seen new patient volumes down in hematology generally. They were down about 10 to 20% versus pre-COVID levels in the MDS population. And so that was one of the factors at play, at least for the quarter. And we have seen, specifically to Revlozil, a bit of a prolonged bolus washout period. And to give you some context around that, in Q4, we estimate that bolus patients for Revlozil were roughly around 40% of the overall business. In Q1, that has come down to about 20% to 25%, and we would expect those patients to continue to come off therapy over the coming months. Those two dynamics notwithstanding, we are very encouraged by the continued uptake of new patient starts in this setting and continue to see new trialists and an expansion of the prescriber base, which is critically important at this point in the launch. So continued excitement from our perspective with respect to Revlozil. Onuregan, supposedly in terms of pivot points, I would say You know, as we have discussed in MS and as you've seen with some of our peers, it does take time to transition patients from written scripts to commercial dispensation in MS. That said, it was a big focus area, as we discussed last year, and we are seeing very nice acceleration for Zapposi and MS. And, of course, we have the opportunity in UC coming up with the PDUPA date in a month or so, and that's obviously another important opportunity for Zapposi and very much look forward to bringing this differentiated product and mechanism into IBD. Onureg, we're in the process of creating a market with Onureg. And that launch is going very well. In fact, we saw patient demand volume increase about 50% from Q4 coming into Q1. And I would say in that space, we're very excited with what we're seeing. Now, again, it's a market where we're creating a new treatment paradigm, and that's going to take some time. But all indicators are that the efficacy profile of this data is landing well with customers. And again, the teams are executing well. And then pivoting to your question on cell therapy, we're very excited about the two cell therapy launches. Both products have been very well received. Given Breonzi's got a little bit more data in terms of the launch timing, let me start there. The launch there is going very well. We've had over 50 accounts that have been activated already. Our highest priority accounts, in fact, were activated within eight weeks of approval. The messaging around the best-in-class profile for Breonzi is landing well. Physicians are clearly seeing a differentiated safety profile. And, in fact, we've already infused data and infuse patients with Burianze. And so I would say the execution there has been exceptionally well. And just quickly on abecma, obviously a bit earlier in the process for abecma, but we have the advantage of launching that product on top of the infrastructure that we've built with Brianzi. So we've actually been able to more rapidly activate sites there. We've had 25 centers were activated within 10 days of approval. The physician feedback has been very positive, and there's a lot of enthusiasm for us bringing the first BCMA-targeted cell therapy into multiple myeloma. So, so far, early days, but the launch has seemed to be off to a very good start.
spk04: Thanks very much, Chris. Can we go to the next question, please?
spk03: Our next question comes from Andrew Baum of Citi. Please go ahead.
spk17: Many thanks. First question is to Giovanni. In relation to business development, Bristol, we anticipate, is going to be more active than many of your peers, given the cadence of LOEs you have in your portfolio. The FTC has been making increasingly loud noises about consolidation being a driver of increased drug prices and diminished patient access. of late. I'm interested in how you think this could impact business development going forward, whether it's more noise than actions and what we should be looking for in novel mechanisms to engage to determine whether M&A relates in anti-competitive activities. And then second question for Summit, perhaps you care to comment on whether you anticipate a panel meeting to assess JAXA safety broadly in a cross-divisional way. And I'm obviously thinking about the crowd-assisted NIRB in terms of its broader membership of that particular category. Thank you.
spk18: Thank you, Andrea. Let me start with your question on business development, and then Samit will follow on your second question. So it's really difficult to speculate at this point in early days what the evolving position of the FTC will be. A couple of things that I would say is, number one, I do agree with you that business development is an important priority for us. It has been for a while, and it will remain one of the priorities for deploying capital and our capital allocation strategy. The second thing that I'd like to say is that I actually feel that we've demonstrated over and over that when we acquire assets into the company, it's actually a way of accelerating their development and generating even more value for patients, and at an important element of what drives our business development strategy. I feel there are plenty of opportunities to continue to strengthen our portfolio across all of the areas where we have presence and expertise, and obviously we'll always take competition issues into account when we look at opportunities, but I don't see that at this point as limiting our ability to continue to to execute a very differentiated business development strategy. So, with that, Samit? Samit Chowdhary Yeah, thanks, Andrew.
spk10: And certainly, yes, we've heard the speculation around adcom for potentially looking at it from a safety perspective for tick-2 inhibitors and whether they belong in the jackpot. The way we think about it is, as we have presented, if you look at the data, we do believe it is very differentiated. And there are absolutely good measures in terms of thinking around preclinical data, the clinical data, the mechanism of action, and the way the data has evolved also on the efficacy side. So overall, I think we have very strong arguments. If there is an adcom, certainly we'll be prepared with that, with all the data that we've shared already, and we'll continue to evolve in terms of the long-term follow-up as well. We do believe this is a new breakthrough in science. It's a new first-in-class molecule as a TIK2 inhibitor, potentially first as it brings new efficacy data for patients with psoriasis, which is an unmet medical need. So certainly looking forward to sharing more as we go along. At the current time, we are in discussions in terms of preparing the file and getting it through the regulators and move it forward as soon as possible.
spk04: Thanks so much. Keith, can we go to the next one?
spk03: Our next question comes from Ronnie Gall of Bernstein.
spk05: Good morning, everybody. Two, if I may. First, the office has now come out to restructure Part D with some participation by pharma through the cost structure of roughly 10%, even from the Democratic side, from the Republican side. I was wondering if you could just kind of ballpark for us the relative impact of pharma participation in the cost structure of Part D and how does that translate into your own revenue? And second... I was wondering how you're going to handle the difference in prices for Zipposia between the MS market and the IBD market, just the two different price bands. You're transcending that, so how are you thinking about handling it?
spk04: Hey, Ronnie, it's Tim. We couldn't quite hear the first part of your question. We heard the part about the price on Zipposia. Could you repeat the beginning of your question, if you don't mind?
spk05: Sure. Part D restructuring, can you give us a feel for how kind of like a 10% hit reimbursement requirement by pharma translate into impact on your revenue?
spk18: Okay. Thank you. Thanks very much. Let me start there, and then I'll ask Chris to address your question on Ziposia. So let me say, obviously, there is continued dialogue about the potential benefit design changes that may be discussed by the administration. And I think it's premature to go into any assessment of what the redesign may, what elements may be discussed going forward. I think what's important is a couple of things. So, first of all, as you know, we have a very diversified portfolio across multiple payer segments and multiple therapeutic areas. And so, you know, there will always be different impacts on different parts of our portfolio from any benefit redesign. There are very different dynamics for a product like Revlimid versus a proto-like eloquent. So that makes it difficult to give you any insights into impact of reforms because it really is important to know the details. What I think is more important is the fact that from our perspective, it is critical that we look at reforms that have one objective in mind, which is to improve affordability for patients in Medicare Part D. That's sort of the core of the priority that the industry has and the proposals that we'll continue to make as we interact with the administration will be focused on elements of Part D redesign that include establishing out-of-pocket caps, reducing the overall impact to patients in the catastrophic phase, smoothing expenses throughout the year. And so, as proposals progress, I think it will be easier for us to provide insights into how that impacts our portfolio.
spk12: Chris? Yeah, thanks for the question. Obviously, we are keenly aware of the differential in prices between the MS market and UC. As you know, we priced Ziposia in line with the value it provides in ensuring the broadest patient access in the MS market. And as we think about UC, it's certainly too early at this point to discuss how we're thinking about pricing in UC. What I would say is that we're going to factor price considerations now. We think about the broader access and the importance of access in IBD generally, and we have plans in place that we'll execute as we get closer to the approval of Zipposia in UC. But it's something we've been focused on for some time.
spk04: Thanks very much, Chris. Can we go to the next question, please, Keith?
spk03: Our next question comes from David Reisinger of Morgan Stanley.
spk13: Yes, thanks very much. I have two questions, please. First, could you just discuss the bar that Bristol-Myers set in first-line melanoma with a combination of Opdivo plus Urovoi, just so we have that in context ahead of the LAG-3 readout ahead? And then second... Could you provide a framework for Ziposia sales drivers in coming years in both the U.S. and ex-U.S.? Thanks very much.
spk18: Thank you, David. Let me ask Samit to start and give you his perspective on first-line melanoma, and then Chris can add any perspective there and give you an answer on Ziposia.
spk10: Yeah, thanks for the question, David. The way to look at it, though, is As Chris mentioned earlier, there's still a large number of patients who are treated with either single-agent IO or through non-IO regimen. So, yes, O plus Y is a very important regimen, has shown very important efficacy and long-term effect and maintenance of that effect, and so, therefore, it becomes important. What we are now bringing is an additional it's a treatment potential for patients who can be treated who have melanoma in the first-line setting with Rilatilumab on top of Nivolumab as a single agent. And that's the reason why we're excited about this, to be able to add to the treatment paradigm for prescribers and for patients to potentially use in the future once approved in this particular setting. One has to remember that we are also talking about the safety profile and its differentiation over here. So, Relatlimab plus Nivolumab, therefore, becomes an important aspect of the treatment paradigm looking at the future.
spk12: Yeah, and then let me take the question on Ziposia, David. So the way we think about Ziposia is, first of all, we're very excited about the opportunity initially that we have both in the U.S. and ex-U.S. and MS. We think that Ziposia brings a very differentiated profile into this market. It's now in the U.S. the number one SP in terms of written prescriptions. We're gaining on oral agents. And as I mentioned earlier, we are making progress in terms of optimizing the patient pull-through in terms of commercial dispense. So we think we've got considerable opportunity to continue to grow in the short term in MS in the U.S. Ex-U.S., it's still very early days for the launches of Zoposia. But I would say that in the early launch markets in Europe, Zoposia's uptake appears to be very good, particularly in markets like Germany. So I think in the near term, there's going to be clearly a focus on maximizing the opportunity that we have with Eposia in that market globally. And then, of course, with the upcoming launch in UC, that becomes a much more important opportunity for us as we get in 2022 and beyond. Ziposia's profile looks very good. The feedback we've gotten from treaters in the IVD space is very positive. Obviously, the rate limiter in terms of the U.S. uptake is going to be access. We know that's a very important component, and we're going to approach that in a very stepwise fashion. It's going to be important that we drive volume initially with those patients who have insurance that is open or relatively unrestricted, and then we'll leverage the Ziposia profile to drive additional utilization and then, of course, work with payers to ensure that we continue to increase the access that patients have in that space. That will clearly take some time, but we think the opportunity in IBD for Ziposia is substantial, and that will be important both in the U.S. and ex-U.S. as we get into that launch later in 2021 and then certainly 2022 and beyond.
spk04: Thanks, Chris. Can we go to the next one, please?
spk03: Our next question comes from Greg Gilbert of Truth Securities.
spk09: Thank you. On LAG3, how are you thinking about the importance of biomarkers here and what level of granularity should we expect around the data set of ASCO as it relates to LAG3 positivity, et cetera? And then Giovanni, a different twist perhaps on the biz dev question. When you took over as CEO, I imagine there was quite a sense of urgency to diversify the company. But with the steps you've already taken to do so, would it be fair to characterize your M&A strategy from here as as more about enhancing existing franchises and less about diversification as a concept. Thanks.
spk18: Thank you, Greg. Let me start there, and then I'll ask Samit to give you an answer on the biomarker strategy for Lactree. I think you're absolutely right. I believe that one of the things that is a clear strength for the company today is the diversification of our business. When you look at our oncology business, solid tumors and hematology, what's happening in immunology, which is clearly the fastest growing segment of our business right now, and the long-term sustainable leadership position that we have in cardiovascular medicine, I think that we have an incredibly well-diversified set of businesses with strong dynamics for all four of them. So I think that's an important foundation that we've built for the company. And at this point, I see that as an opportunity because We have capabilities that we can leverage. We clearly have deep expertise, whether that's from a scientific and development perspective or from a commercial perspective, growing in all of those areas, and it gives us an opportunity to look at assets where we can apply a really promising technology, apply our expertise, and maximize the value of those assets. So, you know, the priority for us now in business development is, across all of those areas to continue to strengthen our portfolio. And as I've mentioned several times, the objective that we have is to further strengthen the outlook in the second part of the decade. But our business is extremely well diversified at this point. Samet? Thanks, Greg.
spk10: Thanks, Giovanni, and thanks, Greg, for the question as well. For LAC3, obviously I will not get into the specifics of the data that we presented at ASCO, but certainly some of the biomarker data will be included in the presentation. As you might recall from all the published literature on LAC3 and in general for IOs, it's been a difficult exercise to get specificities around which biomarkers really dictate the activity of the medicines that we are testing and exploring. So we'll continue to get into that, into deeper details after the data are presented, but certainly looking forward to a better understanding of the overall landscape and as we look to the combinations and other indications as well.
spk04: Thanks very much. Go to the next one, please.
spk03: Our next question comes from Matt Phillips of William Blair.
spk02: Hi, thanks for taking the question. Just two quick ones. Can you give us any update on timelines for an EFS look and the Checkmate 816 trial? And similarly, how do you think The overall market there, the potential opportunity there is impacted by the Roche Empower 010 positive announcement. And then secondly, on the TIK2, given the strong results you saw in the moderate to severe patients, and then also the Tesla advanced study in mild to moderate, any plans to maybe run an additional head-to-head study versus Tesla in a mild to moderate patient population to expand the opportunity?
spk18: Thank you, Matt. Let me ask Samet to address both of your points.
spk10: Well, the second one probably I'll pass it on to Chris. The first one I will say that for EFS, for 816, you've seen the data already for the pathologic complete response. It's certainly very, very encouraging. Looking forward to the EFS readout towards the end of 2022, early 2023 timeframe. So it still remains from that perspective on track, and we'll certainly be sharing it as soon as we have that data available. Just one more thing that I want to clarify what I said early on, on Andrew's question around the speculation on the adcom. The speculation that we hear is around the JAK inhibitors, and we have no knowledge around inclusion of TIK2 as being included in there. And that's what I just want to clarify one more time.
spk12: And let me just very quickly hit on the commercial opportunity for 816 and then turn it back to Summit on TIC. We're happy with the results, obviously, that we've seen so far with 816. As Summit just mentioned, the data continued to emerge in this space. What I would say is that this is a fairly sizable opportunity. There are about just shy of 30,000 treatable patients here. The treatment rates are in the order of 60% to 65%. So we think there's an opportunity to do two things. One, obviously provide an opportunity in the neoadjuvant space for those patients who are being treated today and potentially continue to push the treatment rate. And remember, many patients will be identified once you have more active treatments that are available in this space. So we think there's considerable opportunity here.
spk10: Great, thank you. And in terms of the TIC2 versus the Tesla you brought up, I think, first of all, we're excited about the data that we have. We have, obviously, the mechanism of action that is quite unique over here. Seeing the data in the moderate to severe psoriasis, we have additional studies that are ongoing in the IBD space, in the lupus space. The discussion around mild to moderate psoriasis continues, and we'll certainly share with you ultimately what the plans would be, but truly excited today where we are and certainly the evolution of the data at the end of the year in additional indications. We are not ready to share yet our plans for mild to moderate psoriasis.
spk04: Thanks so much. Can we go to the next question, please, Keith?
spk03: Our next question comes from Steve Scala of Cowen.
spk00: Thank you. A couple questions. Based on everything that has been said, it sounds as though the RELAT-LAMAD data is not competitive with Opdivo plus Yervoy on efficacy. It might be on safety, or am I misinterpreting? You mentioned adding to the armamentaria but not advancing it. You referred to many patients on monotherapy or not receiving IO, but you didn't really refer to those on IOIO. So I'm just curious what we should interpret. And will full data be in the abstract on May 19th? Second question, on slide on page six, of the 90% of products in the continuing business, Should we think about Opdivo plus Urovoi comprising about 50% of that 90%? Thank you.
spk18: Thank you, Steve. Let me just provide some perspective. So to answer your second question, as we've said, 90% of the business by 2025 being continuing business, that excludes Revlimid and Pomalyst. In that 90%, we've said about a third are the launch brands. The rest is the current online portfolio. We're not breaking that 70% down further into individual products. But I think what's important there is actually the strength of the emerging business for the remainder of the decade. And obviously the launch brands become important. particularly important given that we're discussing 2025. Let me just reiterate our enthusiasm for the RELATLIMUB-OBDIVO-FIXTOS combination in melanoma. It is clear that we have a very well-established standard of care with O plus Y and, you know, long durability of response demonstrated over a long period of time. But I just want to again, reiterate that from an efficacy perspective, from a safety perspective, we're really excited to be able to show the data at ASCO Summit.
spk10: And, Steve, the point I would add is, look, we did not do a study of nivolumab plus rilatilumab versus nivolumab plus ipilimumab. So it would be unfair to start comparing the data for the two trials. Secondly, nivolumab plus ipilimumab, as Chris has said earlier, as Giovanni just said, has been established for a long time. So we have long-term data, overall survival data, response rate data. For the LAPDMAB, we do not have the overall survival data as well as the response rate data. But we are excited to see where we stand with our overall progression-free survival data as compared to single-agent nivolumab. And you'll see that data very soon. And certainly, we can have a dialogue after that. But as Giovanni said, very pleased where we are and certainly looking forward to the evolution of the data as we go forward.
spk04: Thanks, Simon. Can we go to the next one, please?
spk03: Our next question comes from Louisa Hector of Barenburg.
spk11: Hello. Thank you. I wanted to return to the Zykozia piece. I mean, MS is a very tough market to be launching into through COVID. I'm just wondering which patients are starting on Zykozia, and do you expect that to evolve? And then on the UC indication, are you anticipating an adcom? And could you update us on how you're preparing for launch? Thank you.
spk12: uh chris sure let me start um and then i can maybe turn it over to summit for the adcom question so very happy with the performance of the posia in ms particularly as you point out in light of uh the covet environment this was as we had talked about last year a market that was hit by covet in terms of new patient volume being down and and obviously this is a market that we are entering uh into relatively new for for bms and so At the end of last year, we spent a considerable amount of time making sure we were engaging with customers in many cases for the first time. And so our focus was continuing to do a few things. First, it was making sure that we were selling the profile for this, what we believe and clearly is being demonstrated in the data. number one SP in this market. We've seen very good uptake in terms of written prescriptions here. Obviously, the dynamic pool of MS is relatively small and we've seen most of the business at this point coming from switch patients and we're continuing to get an increase in new patients who are coming on board as well. So we're very happy with that. And we would expect that to continue to evolve over time. And then obviously, as I mentioned in one of the previous questions, a big focus for us has been making sure that we continue to convert those written scripts into commercial dispense and ensuring a very smooth journey for patients in this market. And we've had a great acceleration there. excited about what we're seeing so far, and we think we're on a very good trajectory for Ziposia and MS in the U.S.
spk10: Simon? Yeah, and just very briefly on ulcerative colitis, we are already at the end of April. Our Purdue for date is end of May. We have heard nothing but very good conversation with the FDA, so we have no knowledge of an outcome for ulcerative colitis for Ziposia.
spk04: Thanks, Simon. I think we've got time for maybe two last ones. Can we go to our next one, please?
spk03: Thank you. Our next question comes from Dane Leon of Raymond James. Please go ahead.
spk19: Thank you very much for taking the questions. Congratulations on the start to the year. I know it's late in the call, but thank you for taking the questions. And I'll keep this, I guess, hopefully brief. A question we get a lot from investors is how to think about the multiple mile on the franchise over the next couple of years and your market share collectively within that. Obviously, you have some moving pieces with Revlimid with some offsets at the back line. But the specific question, I guess, is, where's your team looking in terms of some of the new agents that the clinical community is becoming more interested in, such as iberidamide, and how do you think that can move into a commercial setting as an offset to some of the headwinds you may face in the space? Thank you.
spk10: Thank you, then. Samit? Yeah, thank you. So you very quickly asked about multiple myeloma strategy. We are leaders in multiple myeloma, of course, continuing to build on the heritage of the image. where we've pioneered in that space. We do have the broadest portfolio, and now we are beginning to see the results of that with the approval of ABECMA. But the way we look at it is a three-pronged approach. On one side, we have the cell mods, which have the potential to allow for us to replace the image over time with a near-term opportunity for ibridamide reading out this year in the four-pronged plus setting, and then the second cell mod, 480, reading out in 2022. The second strategy is the BCMA targeting. ABECMA already approved, and we have the investigation ongoing for T-cell engager as well as the ADC targeting. The third pillar is, of course, the combination. And you will see beginning this year already the studies of cell mods in the earlier line setting, in the one to two prior lines of therapy, and then we'll continue to build on the other combinations as well. So we feel overall really good about our position. by having these multiple modalities, and we are confident that we can continue to build on our leadership position going forward in that space.
spk04: Thanks, Salma. Can we go to our last one, please, Keith?
spk03: Our last question comes from Navin Jacob of UBS. Please go ahead.
spk07: Hi. Hi. Thanks so much for taking my question and putting me in. Just, too, if I may, just I want to confirm that on Allenquist, the $160 million true-up was actually, was indeed a tailwind and not a headwind. And then finally, just on BD, a question for Giovanni, if I can. I noticed you have a somewhat new vertical for BMS so far as having neuroscience. As you think about BD, What are the areas that you'll be looking to invest in and roughly how much are you looking to deploy on an annual basis for the next few years?
spk18: Yeah, thanks, Nevin. So let me just say very quickly, yes, you are right. It is a tailwind, the $160 million. With respect to business development, actually what we are doing or our teams are doing in neuroscience is is really interesting. We've obviously, over the last few years, built a very innovative model where, through a network of partnerships primarily, a small team at BMS has been very successful in advancing an early portfolio that looks quite compelling at this point. So, you know, not a large area of focus from a sort of late stage development for us yet, but an emerging franchise that could be important in the future. As I said earlier, we're going to be looking at continuing to strengthen our portfolio depending on obviously the assets that we look at and are available across all of the areas where we have expertise. We haven't really given a target in terms of spend per year, but we've made it very clear that this is the number one priority in terms of capital allocation strategy. You know, the acquisition of Myocardial last year is a really good example of the type of focus we want to continue to have going forward as a company. And I'll remind you, we have tremendous financial flexibility to be able to invest in the right opportunities and in the right science. So with that, I would like to thank all of you for joining us today as we discussed this quarter. We delivered strong results consistent with our strategy. We've continued to grow revenue, execute on our launches, and advance the pipeline. I'm really proud of what our teams have accomplished so far this year, including so many of the important milestones that have been discussed during the call. And as always, our team will be able to answer further questions you may have during the course of the day and the rest of the week. So have a good day, and thanks again to all of you for participating.
spk03: This concludes today's call. Thank you for your participation.
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