Bristol-Myers shares slump after rival’s failed study
Bristol-Myers shares slump after failed AstraZeneca drug trial
(Reuters) — Bristol-Myers Squibb Co shares fell 5 percent on Thursday as investors bet that a failed cancer-drug trial at AstraZeneca would have negative implications for Bristol-Myers’ similar immunotherapy treatment regimen.
AstraZeneca’s Mystic study, released early on Thursday, looked at a combination of cancer drugs in treatment of non-small cell lung cancer and found it was no more effective than chemotherapy in improving progression-free survival.
Bristol-Myers is studying the combination of two of its top drugs, Opdivo and Yervoy. The company’s shares tumbled 5 percent in premarket trading to $53.26.
Bristol-Myers said the Mystic trials and its own CheckMate-227 trials had different designs, drugs, dosing and scheduling.
“It’s difficult to make direct comparisons or draw conclusions from one trial to another,” spokeswoman Audrey Abernathy said in a statement.
She said the company expects to see some results of the trial in the first quarter of 2018. Analysts had said results might be available late in 2017.
Bristol-Myers is set to hold a conference call with analysts at 10:30 ET (1430 GMT) to discuss its second-quarter results released earlier on Thursday, which has been overshadowed by the Mystic trial results.
The company reported lower second-quarter net profit on Thursday due to higher research and development costs. Sales rose, meeting Wall Street estimates.
Facing pressure from activist investors after losing ground to rival Merck & Co’s cancer treatment Keytruda, Bristol-Myers said sales of cancer drug Opdivo surged 42 percent from a year earlier to $1.2 billion, while sales of Yervoy rose 34 percent to $322 million, both exceeding expectations.
Analysts, on average, expected Opdivo sales of $1.1 billion and Yervoy sales of $307 million, according to Thomson Reuters I/B/E/S.
Merck shares gained 4 percent as the AstraZeneca study results appeared to extend its competitive edge against Bristol-Myers and AstraZeneca in treating non-small cell lung cancer, a large market.
Sales of blood thinner Eliquis, another important Bristol-Myers drug, jumped 51 percent from a year earlier.
Total revenue for the quarter rose 6 percent to $5.1 billion, meeting estimates.
Excluding one-time items, Bristol earned 74 cents a share, matching the average analyst estimate.
The company raised the lower end of its forecast for 2017 adjusted earnings to $2.90 from $2.85 a share, and left the top end unchanged at $3.
Net income for the quarter fell 21 percent to $916 million, while research and development costs rose 31 percent to $1.66 billion.
Reporting by Deena Beasley in Los Angeles; Additional reporting by Caroline Humer; Editing by Jeffrey Benkoe and Bernadette Baum