Bristol-Myers Squibb Company

Myers Skip 2022 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.

Thank you, Sergey, and good morning, everyone. Thanks for joining us this morning for our first quarter 2022 earnings call. Joining me this morning with prepared remarks are Giovanni Caporia, our Board Chair and Chief Executive Officer, and David Elkins, our Chief Financial Officer. Also participating in today's call are Chris Berner, our Chief Commercialization Officer, and Salman Hirawat, our Chief Medical Officer and Head of Global Drug Development. As you'll note, we've posted slides to bms.com that you can follow along with for Giovanni and David's remarks. But before we get started, I'll 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 certain non-GAAP financial measures to the most comparable GAAP measures are available on BMS.com. And so I'll hand over now to Giovanni.

Thank you, Tim, and good morning, everyone. Let's start with our first quarter performance on slide four. This is an important year for Bristol-Myers Squibb, and I'm pleased to share that we've had a strong start to 2022. In fact, just yesterday, the FDA approved Mavacam10, or Camxios. This is a first-in-class medicine for patients living with symptomatic obstructive HCM. It's an important milestone for patients who, up until now, had no options to treat the underlying cause of this disease. I'm proud that we're giving hope to patients and improving their quality of life. It's also an important milestone for BMS. With U.S. approvals of Obdulag and Canxios so far this year, we have significantly strengthened our new product portfolio. and we are on track to potentially launch three important new first-in-class medicines this year. Additionally, strong commercial execution in the quarter resulted in solid year-over-year growth from our inline products and new product portfolio. During the quarter, we saw the first entries of Revlimid generics in the U.S. and Europe. David will comment on our first-quarter dynamics, but for the full year, U.S. entry expectations remain the same, while ex-U.S. erosion is expected to be faster than previously anticipated. Overall, we grew revenue by 5% and delivered double-digit, non-gap EPS growth compared to the same quarter last year. There is good momentum in our business, and our performance in Q1 validates that we are well-prepared for the renewal of our portfolio. with multiple catalysts across in-line products and new product portfolio to more than offset upcoming LOEs and drive growth through the decade. Our very strong financial position gives us significant flexibility as we continue to prioritize business development while paying down debt and expanding shareholder distributions. Let me turn to our scorecard on slide five and provide some context around the important achievements of the quarter. We are making good progress against our milestones, which are central to delivering on our long-term strategy and growth as a company. Starting with the milestones we saw during the quarter, Opdivo was approved in the US in March as the first IO agent to treat early stage non-small cell lung cancer patients before surgery. This indication strengthens its profile in lung and provides additional tailwind for growth. While disappointed with the results of the BankPak program, we are very pleased with the significant progress of our new product portfolio overall. Brianzi is now approved in Europe, our second CAR-T cell therapy approved in the EU. As you know, We've been planning to bring three important new products to market this year. So far, two of those new products, Obdualag and Camzias, received FDA approval. Many of our new products have significant expansion opportunities. For Obdualag, we recently initiated a pivotal study in colorectal cancer. And for Ducravacidinib, we delivered a successful phase two proof of concept result in lupus. Looking to the future, the breadth of milestones ahead is exciting. One that we're looking forward to is the Milvexian Phase II data in secondary stroke prevention. We have decades of expertise in cardiovascular disease, and we believe this could be a medicine that treats an even broader population of patients than current oral anticoagulants. We expect to get Phase II data in-house around the middle of the year, And depending on the results, we plan to start phase three trials later this year. Turning to our three new products on slide six. As I mentioned, in March we received approval for Obdualag for the treatment of patients with unreceptable or metastatic melanoma. Obdualag is our first in class fixed dose dual immunotherapy combination of nivolumab and the lag-free blocking agent antibody, relatlimab. The combination of relatlimab and nivolumab demonstrated a clinically meaningful PFS-NOS benefit. Obdualac marks the second approved I-O combination that we've delivered and demonstrates our continued scientific leadership in I-O. While we are still in the early days, I can say that the Obdualac launch is going very well. We believe this medicine has the opportunity to become a new standard of care for melanoma patients. In addition to melanoma, OVDUALAG has the potential for new indications, and we are exploring important opportunities in lung, liver, and colorectal cancers. Turning now to our just FDA-approved Mavacamptan, or Camzius. The benefit of Camzius for patients with symptomatic obstructive HCM were further reinforced with the exciting Valor data presented at ACC this month. We're launching CanXios in the U.S. and look forward to receiving EU approval and launching internationally with future indications to come. Finally, we continue to be excited about the opportunity for Ducravacidinib. As you know, we have an FDA PDUFA date in September for psoriasis. We believe that psoriasis patients need better oral options, and this asset has demonstrated superior efficacy compared to the oral standard of care with a favorable safety and tolerability profile. During the first quarter, we also delivered a successful Phase II proof of concept result in lupus, positioning us to start Phase III studies later this year in a disease with a very high unmet need. Importantly, The lupus data continues to show the consistent and differentiated safety profile of a selective TIK2 inhibitor. We plan to share comprehensive data with the scientific community at an upcoming Congress this year. With our upcoming FDA PDUFA date in the third quarter, phase C trials already underway in psoriatic arthritis, and a proof of concept achieved in lupus, and additional phase two trials ongoing, including in IBD, our confidence in the potential of this program continues to grow. Now, turning to slide seven. Thanks to the hard work, dedication, and strong execution by our employees, I am confident in our ability to deliver on our strategy and more than offset key LOEs by continuing the growth of our inline products with 8 to 10 billion in incremental sales and delivering 10 to 13 billion of revenue expected from our new product portfolio by 2025. Our strong clinical performance further de-risks our launch portfolio. And as a result, we have confidence in our ability to deliver the 25 billion plus in non-risk adjusted revenue in 2029. We have a strong foundation in place, and as the renewal of our portfolio gains further traction this year, I am confident in the potential of our company.

Now, I'll turn it over to David. Thank you, Giovanni, and welcome again to our first quarter earnings call. I'm pleased to turn to slide nine to discuss our top line performance. Unless otherwise stated, I will discuss sales performance on an underlying basis, which excludes the impact of foreign exchange translation. Total company revenues in the quarter exceeded $11.6 billion, growing 7% year-over-year. This was driven by strong double-digit sales of our in-line and new product portfolio, partially offset by our recent LOEs. Let's take a closer look at our new product portfolio performance on slide 10. In the first quarter, the new product portfolio contributed $350 million in revenue, more than doubling revenue versus prior year. But the combination of factors, including the usual year-end buying patterns impacting sequential performance, remain confident in the growth potential of the new product portfolio. The first in-class approvals of OptiLight and yesterday's FDA approval of CumZios further strengthen our confidence in the new product portfolio. We also look forward to our upcoming PDUFA Day for DeGravisit in September, which would deliver another first-in-class medicine for patients with the opportunity to deliver more than $4 billion in non-risk-adjusted revenue in 2029. These initial approvals are just the beginning, as many of these new medicines have significant expansion opportunities into additional indications. Now let's look at our expanded and more diversified business by therapeutic area, turning to our solid tumor performance on slide 11. Opdivo and Urovoid continue their growth trajectory, growing double digits versus prior year. This is driven by continued demand for our newly launched indications and our core indications. In the U.S., Opdivo grew double-digit versus prior year, driven by demand in first-line lung, renal, and gastric cancer, as well as adjuvant esophageal and bladder cancers. Outside the U.S., first quarter year-over-year revenues increased double-digit. This strong growth was primarily driven by expanded access in emerging markets, as well as demand for new indications in developed markets as we continue to secure reimbursement. Looking forward, we expect continued growth of Updivo from our new and expanding indications. With the launch of OptiLag in mid-March, we are pleased to be the only company with three approved IO agents. While early days in the launch, we generated approximately $6 million in sales, half of which was demand and the other half stocking. We are encouraged by the initial feedback suggesting the potential for OptiLag to be a new standard of care for patients with metastatic melanoma. And I look forward to providing more updates as the year progresses. Now let's move to our growing cardiovascular portfolio on slide 12. I'll start with Eliquis, which continues to grow globally with revenues up 14% year over year. In the US, sales increased 12% versus prior year, driven primarily by total prescription growth of 10%. Internationally, sales were strong, up 17% versus a year ago. This strong double-digit growth was primarily driven by increased share across key markets, and the brand continues to be the number one OAC in multiple countries. Turning to our expanded portfolio, I'm really excited about the approval of Mavicampton, now known as Convios, for patients with symptomatic obstructive hypertrophic cardiomyopathy, or OHCM. We plan to leverage BMS's existing CV leadership, building our strong expertise and relationships focused initially at top HCM centers. Our field teams are excited to bring this product to patients in the U.S., and Chris can provide more details on our go-to-market strategy in the Q&A session. Now let's turn our attention over to a few of our hematology products on slide 13, starting with Revlimid. Scales in the quarter were nearly $2.8 billion. Revenues were primarily impacted by generic entry. During Q1, we saw generics enter the U.S. later than expected entry, and so far at a modest pace. As mentioned last quarter, we expect variability quarter to quarter due to the uncertainty of how generic players will enter the market. Though there is no change to our outlook for the U.S. revelment this year and beyond, we expect favorability we saw in Q1 to reverse in Q2. And internationally, generics launched broadly across Europe in mid-February, and erosion has been faster than expected. As a result, we now expect full-year global sales to be approximately $9 to $9.5 billion. Based upon U.S. phasing and ex-U.S. dynamics, we expect second quarter global revenues to be approximately $2 billion. Comilus global revenues grew 9% first part of the year. Global revenues continue to be driven by volume and market share gains as patients move to earlier lines of treatment and extending duration of treatment. Now, moving to Rebozell, which generated revenues of $156 million in the quarter, sales were up 41% versus prior year, primarily driven by continued demand in ESA refractory MDS patients. In the U.S. to date, we have robust on-label share in RS-positive patients. We're seeing encouraging trends in the reduction of time and the switch from ESA failures, which is also supported by NCCN guidelines. We have also made progress in physicians up-trading

a patient's dose to ensure sustained duration and benefit.

Our focus remains on patient identification and dose titration for optimal outcomes. And outside the U.S., RoboZell continues to grow with increased share in both MDS and beta-thalassemia-associated anemia. We have now launched in six countries outside the U.S. and expect to launch in moving to cell therapy launches of Beckman and Brianzi. Beckman generated revenues of $67 million in the first quarter. As expected, sales were largely similar to the fourth quarter of 2021 as demand continues to be robust and we work hard to expand capacity. We are on track to expand capacity in the middle of this year to the myeloma. As it relates to Brianzi, sales in the quarter were $44 million. Sales are driven primarily by demand in the U.S., so our physicians continue to recognize Breonzi's best-in-class profile. We are very pleased with the recent EU approval for Breonzi and ThirdLine Plus large B-cell lymphoma and look forward to launching in select markets in 2022. Additionally, we are preparing for the U.S. launch of Breonzi in second-line large B-cell lymphoma in June and are ramping up moving to our immunology product summary on slide 14. Our rent-to-sales grew 6% versus prior year due to expanded U.S. sales driven by increased market share in the U.S. As it relates to Siposia, global sales in the quarter were $36 million. Functionally in the U.S., we saw encouraging demand growth that was offset primarily by buying patterns from prior quarter and higher gross to net impacts related to patient access and ulcerative colitis.

We are pleased with the awareness and perception of Zippo's EMUC and are encouraged while strengthening access and reimbursement and expect to have increased content in the second half of this year and expanding into 2023.

Internationally, Soposia continues to secure reimbursement in other markets for MS, as well as obtain additional reimbursement for the launch plans that are already underway to prepare for Ducrevisit and its upcoming PDUFA date in September.

Now, let's turn to our first quarter. As noted recently, we changed the along with other pharmaceutical companies, we no longer exclude significant research and development charges or other income resulting from upfront or contingent milestone payments in connection with asset acquisitions or licensing of third-party intellectual property rights.

These charges have been included in our GAAP results, and there is no impact to the economics of our business. Going forward, we will now include these previously specified charges in both GAAP and non-GAAP results as a new line item called acquired in-process research and development, as well as in the quarter operating expenses and development increased versus prior year, primarily due to increased MS&A driven by differences in timing of spend in the prior year. Net charges of $280 million consistent of acquired and processed R&D charges offset by licensing income are primarily driven by upfront milestone payments associated with the AMATX and Dragonfly licensing agreements. The first quarter effective tax rate was impacted by earnings mix. Even with this new financial presentation and the 10 cent impact from the inclusion of acquired and processed R&D and previously specified income, Our strong performance in the quarter allowed us to grow non-GAAP EPS 13% versus last year. Excluding this, the new presentation chain of non-GAAP EPS would have grown 18%. Now moving to the balance sheet and capital allocation on slide 16, cash flow generation for the company remained strong. Cash flow from operations in the quarter was approximately $3.8 billion. We ended the quarter in a strong liquidity position with approximately $15 billion in cash and marketable securities. Our capital allocation priorities remain unchanged. BD continues to be a top priority, and we remain committed to continued debt reduction and returning capital to shareholders. And in the quarter, we executed a $5 billion accelerated share repurchase program. Approximately 65 million shares, or 85% of the $5 billion aggregate repurchase price, were delivered to the company in the quarter. The ASR will settle over the next couple quarters, and we remain opportunistic. As you know, we guide the timeline and report our results. We're updating our top-line guidance to be in line with the guidelines prior year, primarily due to movements in foreign exchange, reflecting the spot rate of the dollar today, and faster erosion of revenue outside the U.S. Recent LOE product guidance is also being changed to reflect the updated RevaMet outlook in the range of $9 to $9.5 billion. Though FX headwinds impact our entire portfolio, the outlook for inline products and the new product portfolio remains unchanged. This reflects the strong performance and confidence in our future growth drivers. We now expect total operating expenses excluding in-process R&D to decline in the low single digits versus prior year, driven primarily by cost discipline and the impact of foreign exchange gap earnings. There is no change to our outlook for non-gap EPS. The impact of certain acquired in-process R&D and licensing income that are now included in non-gap EPS. Our new range is $7.44 to $7.74, driven by the previously announced $0.10 impact from the actuals in the first quarter, an additional 11 cents related to the buyout of future rurality obligations from Abicanton that occurred in April. Before we move on to Q&A, I want to thank our colleagues around the world for continuing to deliver strong commercial, clinical, and financial results. I'm really excited for what lies ahead. I'll now turn it back over to Tim and Giovanni for Q&A.

Thanks, David. Sergey, can we go to our first question, please?

Sure. Our first question comes from Chris Schott from J.P. Morgan. Please go ahead.

Great. Thanks so much for the questions. Just two for me. First, you may talk about chemzios, if I'm pronouncing that right, and the echo monitoring requirement there. It seems like it's a fairly kind of long program. I'm just wondering how you see that impacting any uptake the drug could have. factor 11a data we saw last month i guess specific question would be just talk about the attractiveness of afib as a category for the factor 11a's and you know is that a focus for bristol or is your focus more in markets factor 10a usage so something called oh that would be appreciated thank you thank you grace good morning uh

I'll ask Chris to answer your question on Camxios, and then Samit will comment on Milvexion.

Hi, Chris. Thanks for the question. Since this is the first question on Camxios, let me just say at the outset that we're incredibly excited to be launching Camxios. This is an important new medicine for obstructive HCN patients. And for those of you who are at ACC, you know there's palpable excitement and anticipation of this drug.

So this is a great opportunity for... We've been working with...

on its team and the FDA on the design of this RIMS and with customers on how we would execute against it for a number of months. We view obviously the RIMS as important because it ensures that patients are able to be treated safely, that they get on the right dose, and that they're able to ultimately get the full benefit for Camzodios. There are two key components as you think about this REMS. There's a titration period, which is all about monitoring patients to ensure they get the right dose. This is largely akin conceptually to how cardiologists manage hypertension. And then the second component is ensuring eligibility of drug-giving background medications. As we look across both of these two key components together, we see the requirements for the RIMS as manageable, generally fitting, as I referenced earlier, to the treatment approach for cardiac patients. and we don't see them as a barrier to adoption. Now, with respect to the echo monitoring period specifically, we obviously consulted customers as we were working through the design of the RIMS, and they don't see it as a concern for a couple of reasons. First, the requirements of this monitoring period are relatively minimal. You have to get an LVEF and an LVOT reading. That can be done with your local physician. So for those patients who are being treated in centers of excellence, they can go back to their cardiologist, local cardiologist's office to fulfill those requirements. Second, you have to remember patients would be coming back a couple of times a year anyway for ECHOs, and a number of patients would be coming back much more frequently for symptom management So physician visits every three months is not seen as particularly burdensome. And the last thing I would highlight is a very important point, which is that patients are going to be highly motivated to work their way through this period. As we saw with these four study, patients are highly motivated to stay on drugs. They feel better on CAM-Zios. And so we think there's going to be strong motivation on their part to work through these requirements. So net-net, this is something we'll be obviously educating customers on, but we don't see this as a barrier to use.

And, Chris, thanks for that. And, Chris, from GPM, for your question on Melvixian, I think, first of all, we are truly excited about that medicine as well as we look forward to getting the data in-house in the middle of the year. The read-through from the Bayer presentation, I would say, is that it further strengthens our confidence in the mechanism of action as well as provides a further proof of concept that inhibiting factor 11A is a safe way to provide further anticoagulation or antithrombotic therapies to for patients who really need it. As it comes to what indications we'll be pursuing, we'll continue to work with our partners, Janssen, to really define those once the data are in-house, and we can look at the data, the dose, the ways of administering the drug, and all in all, we'll be able to share that with you once we're ready with the data and the retros. Thank you.

Thanks, Samit. Sergey, can we go to the next question, please?

Sure. Chris Shibutani, Goldman Sachs. Please go ahead.

Great. Thank you very much. Good morning. Congratulations on the approval. Ancan Zayos as well. Perhaps can you talk about two issues, one relating to access and the other in terms of timelines for which you feel that the physicians are going to get more comfortable with dosing. Perhaps can you update us on your expectations for access timing relative to this approval and with the early phases of the rollout and, again, timing on when you're going to be educating physicians and expecting them to get more comfortable with the regimen and the REM.

Thank you. Thank you, Chris.

Chris? Sure. So two very good questions. So let me start with access. In general, we anticipate the majority of these IOS patients are going to have very good access for this therapy. Remember, about half of the patients who are obstructive HCM are covered by commercial and Medicaid. And we think access in this patient population is going to be particularly good, and we expect Initially, a disproportionate share of our use is going to come from this patient population. Now remember, like virtually all specialty medicines, Camxios is not going to be on formulary day one. We will plan to cover these patients on bridge programs for the roughly four to six weeks that are going to be required to work through the exceptions process, but we've built strong patient support programs to assist these patients during this time, and we expect minimal barriers for these patients during this initial period. And then, of course, once CAMSIOs is on formulary, we would expect access to be much more straightforward. Now, for Medicare patients, we expect that share is going to grow over time as any affordability challenges there get resolved. Initially, the opportunity will be mainly in the low-income subsidy patients, but then the broader population use will expand as additional support becomes available to address any affordability issues there. to your second question on timelines for dosing education. We actually think that's going to be relatively rapid. A few things to keep in mind. Number one is we worked through this label. I referenced that we were working with customers on how we would execute against So many of the customers, particularly in centers of excellence, which will be the primary focus at launch, are already roughly familiar with the dosing requirements here. And obviously the initial focus of our commercial efforts are going to be in these centers of excellence. So we think the understanding of the dosing requirements and the REMs more generally are going to be very good at launch there. And then we're going to be targeting a much broader audience, in fact, the majority of potential obstructive HCM patients with our launch efforts. We're staffed to do that, and those education efforts are underway beginning today.

Thanks, Chris. Sergey, can we go to the next one, please?

Sure. Jeff Mitchum from Bank of America. Please go ahead.

Hey, guys. Good morning. Thanks for the question. I just had a couple of the new product launches. So first on Brianzi, just wanted to get kind of an update of where you guys, what you guys think drives a real inflection. If you had any update as well on the manufacturing, that would be helpful. And then on Zapposia, can you just talk a little bit about the drag on access, just timing for, you know, for formulary additions, et cetera. Just kind of wondering the drivers of an inflection for that brand as well. Thank you.

Thank you, Chris. Sure. So let me talk about Brianzi first, then I'll touch on Zapposia. So Brianzi, we're happy with the continued performance that we saw in the quarter. We were up, obviously, sequentially. We're seeing within our existing indication continued performance. Strong interest from physicians in using the product. Patient enrollments from activated accounts were up nicely in the quarter. We saw a nice increase in A4E patients, and that translated into growth in Brianzi's overall class share, which is now roughly 20% to 25%. Particularly important from my perspective is that Biryanvi continues to be seen as the best in class asset here. And so to a label expansion into the second line setting for this asset, which continues to be on track and some that can speak to that in the second half of the year with respect to manufacturing. As we've said previously, obviously that's a big focus for us. We have consistently said that our focus is on expanding that capacity to be on track. As for Ziposia, again, I think we are happy with the continued progress that we've made with Ziposia. As David referenced, we had a few dynamics in the quarter with respect to gross-to-nets. and inventory. That said, as we look at that product, particularly in UC, which is obviously important for the long-term growth of the product, there are two things that are going to be critically important for the success of the product.

First, we've got to, as you referenced, improve access. And second, we've got to drive volume. And since both of those things co-travel, maybe I'll just give you a quick update on both. With respect to access, we have very broad formulary access today.

And, in fact, we've seen the quality of that access improve this year relative to last year. But as we expected, the majority of patients for Ziposi and UC still have multiple step edits. And so we've got to continue in the quarter. Patient starts were up about 30% in Q1 relative to Q4.

We continue to expand our user base nightly. up for continued volume when they come on therapy are going to initially be triaged to our bridge program.

So what we've got to do this year is first we've got to convert those patients to commercial drug where possible.

For patients who have better access, we need to convert them over. And the second, obviously, we've got to continue to drive new patient starts. So as I look at the quarter, I think we've made good headway. We've got more work to do.

But as we begin to achieve success, particularly in moving those patients from bridge to commercial, you'll see greater volume of sales coming from UC, and that will set us up for continued success later this year and into 23. Yes.

Sergey, can we go to the next one, please?

Seamus Fernandez, Guggenheim. Please go ahead.

Great. Thanks so much for the question. So your comments earlier on the call with regard to the opportunity and your knowledge there, feedback that we have gotten from thought leaders and experts is a bit of a riskier indication, more in the context of the patients that get recruited.

and the interactions that can occur between clopidogrel and aspirin that perhaps could confuse a little bit of the data as it relates to factor XI.

So I wanted to just get a better understanding of how you guys are controlling for that.

There are genetic

factors that impact clopidogrel bleeding risk, things like that, as well as the efficacy of clopidogrel. So just wanted to get a sense of how you are managing for that, whether you're stratifying for it or perhaps looking at that after the fact. And then the second question on Mavikampton is, Obviously, I think the price may be surprised to the upside a little bit at $90,000 annually. You know, that's quite a widespread between that result and the ICER evaluation of less than $15,000 a year. Obviously, you know, can you just comment on that differential and how you hope to get beyond that with additional clinical studies? Thanks, guys.

Thank you. Thank you, Seamus. So let me just make a comment at the beginning. You know, we've been very clear with respect to the ICER assessment of Mavacampt and with the fact we didn't think it was scientifically accurate and not based on solid data and methodology. So Chris will give you his perspective about the Mavacampt and value and price. Before that, though, Samit will answer your question on Milvexian and SSP.

Samit Sharma, Thank you, Giovanni, and thanks, Seamus, for your question. On Milvexian, as you know, the SSP trial is ongoing. It's more than 2,000 patients that have been enrolled in the study and will have a readout in the middle of the year, as I said earlier. We have the background therapy of Copetagrel AS, and with that data, we will be getting all of the PK data as well as all of the safety data. and we'll be able to then analyze if there are any interactions.

Having said that, we've done quite a number of DDI studies, and we do not see drug-drug interactions as issues.

And, of course, the overall safety that we will get from this study, combined with the data from the TKR study that we've already done, will then define how we proceed further. Since the data are almost around the corner, let's wait for that and not speculate on how the application will be in the SSP study. And certainly when the data are available and then presented at medical conferences in the future, we can have a further dialogue on that. Thank you. And Chris?

Thanks, Seamus. I think Giovanni addressed the question on ICER. So as it relates to the specific price for Camxios, we price this product very much consistently with how we price products generally, which is looking at a variety of factors and notably the value that the drug brings to patients in the healthcare system with a strong focus on ensuring that we are providing rapid and sustained access for patients. Remember with chemzios, this is the first therapy that effectively targets the source of obstructive HCM, so there really aren't any clinically comparable therapies here. You've got largely ineffective, nonspecific products like beta and calcium channel blockers that are relatively old and inexpensive, and then you've got more effective but highly invasive procedures like myectomy and septal ablation, these procedures alone can be upwards of $100,000 to $150,000, and then you've got ancillary costs associated with those. And remember, they don't cure the disease, so you've got ongoing multiyear costs associated with these products as well. So it's a fairly broad range of prices. Where we net it out here we think is a price that, as I mentioned before, reflects the value of the product. We don't see any incremental concerns with respect to access, and as I referenced in the previous question, we have a robust suite of programs and resources that are in the market to help address any patients or caregivers to support access for this product.

Let's go to the next question, Sergey.

Sure. Evan Sigerman from BMO, please go ahead.

Hi, guys. Thank you so much for taking my questions on and congrats on the approval last night. So I just wanted to touch on relevant. I know you David, you had mentioned some color on the call in your prepared remarks. But aside from FX, characterize any other potential downside risk to the guidance over the remainder of the year? I'm just trying to get a sense of kind of the erosion curve, OUS, and what we should be thinking about. And now that we're into the quarter, can you really characterize what you're seeing, OUS, and kind of maybe give us some more color there? And just on one housekeeping item, on that royalty obligation you brought back for Mavikampton, any impact we should be thinking about in our models? Thanks so much.

Yeah, thanks, Evan, for the question. And on Revlimid, you really need to think about it in the context of the two markets, the U.S. and OUS. And as I said in my prepared remarks, for the U.S., the generic entry was later than we'd anticipated, and the erosion has been modest. And as a result of that, we think that will come out in the second quarter, and that's why I provided guidance on the second quarter for Revlimid overall of $2 billion in Q2. As you think about the full year, outside the U.S., we have multiple generics enter in Europe in mid-February, and that erosion has been faster than we anticipated. And based upon that erosion that we're seeing, that's why we changed the full-year guidance on Revlimid between $9 and $9.5 billion. As you think about longer-term Revlimid going forward, you may recall that we provided a guidance of about $2 to $2.5 billion per year over the next couple of years. And as we head into next year, since the erosion a little faster this year, we'll probably be at the lower end of that range of around $2 billion for next year. So that's unraveled. And Mavic Empton, there was a minor royalty that we were able to, you know, retire that obligation. And, you know, it'll be a slight improvement to our gross margins, but we don't guide gross margins for our products overall. It's a low single-digit royalty obligation that we're able to expire.

Thanks. Can we go to the next one, please, Sergey?

Andrew, please go ahead.

Thank you. A couple of questions, please. Assuming Axiomatic SSP leaves out positive, I'm curious as to which clinical settings you'd actively avoid with norexia, given it only inhibits one of the pathways, the intrinsic pathways. Dioxaz failed in ECOS, they failed in the chemical heart valves. I'm just looking for some guidance, not where you want to go, but where you would be disinclined to go. And then second, given the accumulating long-term follow-up on Ducravacitinib as the indications expand, I wonder whether you'd care to comment on any imbalances for zoster or thrombosis in that collected data that I'm sure you've shared with the agency. Thank you.

Thank you, Andrew. Let me ask Sami to answer both of your questions.

Thank you, Andrew. And I like the new flavor of the question on the indications for melvixine. asking the same question the different way, but I think the answer will remain the same for you, that we are not disclosing at this time what indications we are going to pursue or exclude. We will have to make those decisions once we have the dose, as well as our conversations with our partners and, of course, in conversations with regulatory agencies in terms of how we will conduct the studies, what control arms will be used, et cetera. So certainly would be happy to have that dialogue once we are there with the data as well as the decisions. On Ducravesitinib, you're absolutely right. We are continuing to be very confident in the profile of the medicine. We have the data, of course, from Poetic I, Poetic II with long-term follow-ups now. We've conducted studies in psoriasis in China and Japan as well, which continue to support the overall profile. Additional data, of course, from psoriatic arthritis, Phase II studies, SLE study that we've talked about as well, all continue to support the overall safety profile of that we have seen in terms of the very specific inhibition of the TIK2 pathway without an impact on the JAK pathway perspective to the agencies, and looking forward to that launch in moderate to severe psoriasis in September of this year.

Thanks so much, Sergey. Can we go to the next one?

Steve Scala, Calvin. Please go ahead.

Thank you very much. I'd like to follow up on the Revlimid trajectory. It looks like the second half Revlimid revenue is expected to be about $4.2 to $4.7 billion. That implies a flat to up performance versus the second quarter. Can you discuss why it will be up in flat to up in H2 if pressure has intensified in both the U.S. and OUS? That's the first question. The second question is, and I apologize for splitting hairs, but Milvexian data was expected in the first half. Now it's mid-year. That is a modest change, but has there been some sort of delay maybe because of events? This isn't necessarily meant directed at Bristol, but it seems in this industry mid-year is always the third quarter, and the third quarter is always September. So any color would be appreciated. Thank you.

Thank you, Steve. Let me answer the second question, and then I'll ask David to answer your question on Revlimid. There is no change to the timelines for Milvexian. So the study is on track, and we look forward to updating you as soon as the data is in-house. David?

Yeah, and Steve, thanks for the question on Revlimid. The thing that's important to remember, in the U.S., we only have one generic entry in the first half of the year. And then we have multiple generics that we're entering in the second half of the year. So that's why the phasing is from quarter to quarter. And it can shift, as I was saying, because the generic entry will be in the September timeframe. So depending on how quickly that comes into the market will impact the phasing of the product quarter to quarter. But you will see more generics in the U.S. in the second half of the year.

David, Sergey, can we go to the next question, please?

Louisa Hector, Bell & Barrett, please go ahead.

Thank you very much for taking my questions. I wanted to ask you whether we can compare and contrast the Ziposia ramp with the potential ramp of Ducravacitinib. Do you anticipate a similar sort of challenge, I guess, in terms of access and volume as you bring that product to market? And really, it's a question about how we should moderate our launch ramp for Ducrava Sittiment. And on M&A, your comment's still consistent commentary. But given some of the changes to valuation for some of the targets, I just wondered whether any of the dialogue is also shifting. Are you finding more companies approaching you? Is there more dialogue around collaborations on early-stage pipeline, just any shift in the dialogue. Thank you.

Thank you very much. Let me just answer the second question on M&A, and then Chris will answer your question on Ducrava. And let me just reiterate that our focus on M&A has always been there. It's the central pillar of our capital allocation strategy. It's a really important partner. of our innovation strategy. We've actually had a number of deals that we've executed in the last few months, which really confirms our very proactive approach to business development and more broadly. And as a result of that, that will continue to guide us in the future. With respect to your question about whether we are seeing any change, our experience is that whenever there is a some type of realignment in market values, it always takes a little bit of time for those values to really be the values that boards or biotech companies look at in terms of their valuations. Having said that, of course, you know, values were extremely high. They've somewhat realigned. And then I'll conclude by saying that every company is a bit of a different story, and you have to really look at it one at a time. But we are confident in the ability to continue to bring new innovation into the company through a combination of business development strategies that go from partnership and collaboration in licensing and potential acquisitions. Crisp?

Thanks, Louisa, for the question. Just a couple of things. I would say at a high level there are some important similarities between UC and psoriasis. Volume is going to be important to gain access over time. This is a market that, while it is less competitively intense than what you see in UC, particularly in the oral setting, it is a market that has been historically heavily managed. Now, there are some important differences as well. While psoriasis is heavily managed, we have seen a number of national payers have moved from highly restricted access to more open formulary management over the last few years. That's good for new entrants. We also know that many patients are going to be covered on plans that have open access when we launch. Again, that's an important opportunity for a new entrant like Ducravacitinib. But for the remainder of covered lives, it's going to be important, as we've been discussing with Zipposia, to build volume over time so that we can work with payers to gain more of a favorable access position. So there are some similarities between the two and then a couple of important differences as well.

Eric, can we go to the next one?

Tim Anderson, Walt Research. Please go ahead.

Hi. Thanks for taking our question. This is Adam on behalf of Tim. Uh, so first on tick two, can you talk about the, uh, commercial potential, um, in psoriasis under two different scenarios? The first thing, if you get a black box warning and the second is without that warning, if you do get a black box warning, would it be safe to assume that. Sales in psoriasis could be something like half of what they would be if you had a clean label. And then secondly, uh, just real quick on like three, uh, when will we get the next round of important data? that will inform on success outside of melanoma, not just phase three results, but also earlier trials ongoing.

Thanks, Adam. This is Giovanni. So on tick two, let me just start by saying we are increasingly confident in the potential of that program as I mentioned earlier with PDUFA data in September for psoriasis ongoing phase three. study in psoriatic arthritis, and then of course the SLE proof of concept readout earlier this year, together with ongoing Phase II studies in a number of other indications, including IBD. So the prospects for the program continue to strengthen as we go forward. We've answered that question on regulatory. outcomes specifically with respect to the label a number of times, but let me ask Chris to give you his perspective again, and then Samit will comment on the LAC3 program. Sure.

Thanks, Adam, for the question. So first, I'm not going to speculate on the black box scenario. As we've said consistently, we're going to continue to operate under the perspective of the most likely scenario and the scenario that we believe is most supported by the data, which is that Dicravacitinib has a unique mechanism of action consistent with all of the preclinical and clinical data that we have. And so our focus from a commercial standpoint, while we, of course, scenario plan various versions of a label, that's going to be the operating plan that we go as the most likely case. And so we're still very much focused on leveraging the data from the two Phase III studies that we have that clearly show clinical data that is superior, both from an efficacy standpoint and safety superiority, o tesla which is the only branded oral in the market today and given that efficacy we believe we have a very strong case for establishing ducravacitinib as the branded oral of choice here launch preparations are well underway we have a great team already in the field from a medical standpoint the home office team has been staffed and is up and running We're in the process of hiring the sales force. So our going position continues to be consistent with Ducravacitinib as a unique mechanism of action, and we think we have the clinical profile and the team in place to deliver on establishing this product as the branded oral of choice.

Thanks, Chris. And, Adam, just on the Opzolag, because Lactree is obviously being developed as a fixed-dose combination with Nivolumab. We have several studies ongoing, not only as BMS-sponsored trials, but also through investigator-initiated trials. And through those investigator-initiated trials, there will be continued evolution of the data that will be coming through, even including from this ASCO itself. So you will see the data continuing to come out at various conferences through either our trials or through the ISRs that are being conducted. And, of course, then the Phase 3s will start to read out over the coming years.

Sergei, can we go to the next one, please?

Terence Pleen, Morgan Stanley. Please go ahead.

Hi. Thanks for squeezing me in. Maybe two for me. A follow-up on Updualag. I know it's still early in the launch, but just wondering what types of patients you're seeing receive the drug. I know your initial focus was going to be on the PD-1 monotherapy setting, but is that pretty consistent, or are you seeing broader use? And then in terms of abecma, What percentage of demand are you able to supply now, and can you help quantify how much additional supply will come on later this year? Thank you.

Thanks, Darren. Chris? Sure. Let me start with OpduLag. So we're very pleased, as David noted, with not only the approval, but the reaction from physicians has been very positive. Based on the early read that we have, and again, it's only a few weeks of data, what we're seeing in the marketplace is entirely aligned with our expectations. So, number one, the profile is very well received, given the 2x improvement in PFS, the strong trend toward OS, similar safety relative to PD-1 monotherapy. So the excitement that we've seen around the profile is as we hoped and expected for this asset. Second, what physicians are pointing back to us is they see using this product in the segment initially of the market that we had anticipated. Remember, first-line metastatic melanoma is a market that is essentially divided into thirds. A third of patients are getting dual IO therapy, a third of patients are getting PD-1 monotherapy, and a third are getting targeted therapies, notably BRAF mutants. And so our initial focus had been on the PD-1 monotherapy segment, and that's where physicians have begun to use the product. Now, it's possible that over time that could expand into other segments, but keep in mind that Opdivo Urovoi has a very strong presence there, just given the long-term survival benefit. So we anticipate and what we're hearing right now is that the initial use is going to be in the PD-1 monotherapy as expected. With respect to ABECMA, what I can tell you is that the demand continues to be very strong. We have utilized every manufacturing slot that we have for ABECMA over the quarter. Our focus continues to be on building demand to the middle of the year. in anticipation of continued strong demand for this asset over time. And remember, this is a space in which we've had a competitive agent enter, and so we've still seen very strong demand for ABECMA, which is also in line with expectations. So while I won't give specific guidance as to exactly what that ramp will look like, what I can tell you is our focus continues to be on making sure that we make more slots available for ABECMA. We're in line with our expectations on being able to be in a much better position by the middle of the year.

Okay, can we go to the next one, please? Thank you for taking the questions. Two questions from me, please.

Mabucanton, you know, the premise for the acquisition of Myocardia was obviously not just Mabucanton, but was largely predicated on the opportunity to develop Not just in obstructive HTM, but potentially non-obstructive and HEPPAC as well. The questions we've been getting a lot since the approval last night and the review of the label, no real surprises in terms of the handholding needed to get a patient on drugs and then monitor the patient while they're on drugs. given the pharmacodynamic and PK properties of Mavikantin. But really the discussion comes down to how in Embark, which is your HEPPAT study that I think we'll read out maybe next year, can the dosage and treatment algorithm be modified to make the drug and its properties more accommodative to a preserved detection fraction patient population or non-destructive patient population? And should we Expect to have maybe lower doses be viewed as potentially effective in those populations that might resolve some of the hand-holding needed for the drug. And then the second question is actually in the back of the map. We will have a readout, I think, of the topic term coming out of the Phase II study. That should be fairly informative. Could you just give us your expectations of what you need to see there to feel confident moving forward in any topic term with that drug? Thank you.

Thank you. Thank you, Dave. Let me ask Samit to answer both of your questions.

Thanks, Dave. The line was cutting off, but I think I got the gist of it. So when we think about Mavacant, and you very correctly said that now that the drug is approved in obstructive hypertrophic cardiomyopathy, our intent, of course, is based on the data from the Maverick Phase II study and the long-term follow-up from there, we are initiating the Phase III program later this year in non-obstructive hypertrophic cardiomyopathy. Now, of course, the HFPAF study is a small Phase II study, which is a proof-of-concept trial looking at the dose of 2.5 raised up to 5 milligrams dose. And that data, when we have the proof-of-concept, will then open the door for future indication expansion to HFPAF. And at that time, we'll be able to have a decision around what dose and how to manage the overall profile in terms of dosing these patients in that indication. So more to come as the data evolves and we understand it better, the application of this medicine in that disease. For syndacumab, we have two studies that are ongoing, as you know, with a phase three study in eosinophilic esophagitis. And then, of course, as you said, later this year we'll see the data from the atopic dermatitis. Now, that is the field where we have understood quite well because of the competition that is out there and the data that are out there. So the data that needs to evolve from the Phase II study needs to be in a place where we can ultimately understand the applicability of this drug and the population where it should be used. So, again, let's wait and watch. When the data evolves, we'll be able to discuss that and give more specifics if those data are significant and clinically meaningful to go into Phase III studies. Thank you.

Thanks, Birgit. We'll go to the next one. Okay, can you go to the next question, please? Okay, can you can you hear us? Not sure if you can hear us, Sergey. We're here if you can.

Hello? Sergey?

Yes, excuse me, interruption. Shall we move on to the next question?

Yes, please.

Yeah, go ahead.

I think we're out of time at this point. Maybe we should wrap up the call Giovanni.

Yeah, I'm sorry for the last minute issue. Let me just thank you all again for joining our call. And obviously our teams are available to answer any additional questions you may have. So in concluding, let me just say we're really pleased with the two approvals this quarter, the continued progress we've made with our pipeline and our strong commercial performance. That makes me really confident in our ability to continue to execute. We are very well positioned for growth, and I just want to thank our employees for their continued hard work and dedication. With that, we'll close the call, and again, Kim, Nina, and the rest of the team remain available for answering any additional questions you may have. Thanks, everyone.

This concludes today's call. Thank you for your participation. You may now disconnect.