Bristol-Myers Squibb has potential to recover

Bristol-Myers Squibb is surely at the heart of the turmoil – and it has been there for a long time. Shares lost almost one third of their value in 4 days last year – corresponding to $45bn in capitalization – after it was made public that immunotherapy Opdivo had demonstrated lower efficacy than conventional chemotherapy in treating a type of lung cancer. The apparent pessimism about BMS has been overcome this week by the company announcing a board revolution with three new members (Jana Partners) and – soon after that – by investor Carl Icahn informing he had bought a major share in BMS, since he believes in the drugmaker’s pipeline. In fact, Opdivo is an efficacious therapy for many types of cancer, although it has failed a clinical trial. Moreover, despite nobody now believes Opdivo can generate $12bn per year – as expected before – many analysts agree on a potential of at least $9bn pa. (Source FT)