A puzzling Bristol-Myers Squibb

US-based Bristol-Myers Squibb on Thursday reported its first-quarter results, which have raised uncertainty about the company’s actual potential. BMS generated sales of $5.19bn, that is a +5% increase over Q1 2017, below the $5.22bn expected by analysts. Revenues from Opdivo, Eliquis and Orencia have exceeded expectations, while Sprycel, Yervoy and Empliciti have disappointed investors. Moreover, there is concern over the fact that Bristol-Myers Squibb has lowered the current year guidance, despite a positive currency impact and the benefits from Trump’s fiscal reform, which has granted BMS a 16.9% tax rate over profits, instead of 21.9% (2017). The group, however, has a strong financial position, with $9bn liquidity and a fairly positive scenario for the future. The immunotherapy Opdivo will predictably become the new all-around drug for many cancer types and shows advantage over the more expensive Keytruda by Merck & Co. For example, the Opdivo-Yervoy combo has recently obtained the FDA approval as a first-line treatment for the most common kidney cancer type. Moreover, Opdivo could soon be approved as a second-line treatment of colorectal cancer. Positively, the company has entered into an approximately $6bn deal with Nektar TX, owner of NKTR-214, which will give further contribution to Opdivo’s sales. BMS’ shares have lost over 20% in capitalization in the last weeks, as Pfizer’s CEO Ian Read announced that his company is not targeting BMS. This has disappointed those who had invested in BMS, over rumors that Pfizer would pay over $100bn for the company.