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UNITED STATESSECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORTPursuant to Section 13 OR 15(d) of The Securities Exchange Act Of 1934
Date of Report (Date of earliest event reported): April 26, 2018
BRISTOL-MYERS SQUIBB COMPANY(Exact Name of Registrant as Specified in its Charter)
Delaware 1-1136 22-0790350(State or OtherJurisdiction ofIncorporation)
(Commission FileNumber)
(IRS EmployerIdentification
Number)
345 Park AvenueNew York, NY 10154
(Address of Principal Executive Office)
Registrant’s telephone number, including area code: (212) 546-4000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the followingprovisions ( seeGeneral Instruction A.2. below):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
On April 26, 2018, Bristol-Myers Squibb Company (the “Company”) issued a press release announcing its financial results for the first quarter of 2018. Acopy of the press release is furnished as Exhibit 99.1 to this report and incorporated herein by reference. Also furnished and incorporated by reference as Exhibit99.2 is certain supplemental information posted on the Company’s website at www.bms.com .
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
99.1 Press release of Bristol-Myers Squibb Company dated April 26, 2018
99.2 Certain supplemental information posted on Bristol-Myers Squibb Company’s website at www.bms.com not included in the press release.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersignedhereunto duly authorized.
BRISTOL-MYERS SQUIBB COMPANY Dated: April 26, 2018 By: /s/ Sandra Leung Name: Sandra Leung
Title:
Executive Vice President & General Counsel
EXHIBIT INDEX
Exhibit No. Description
99.1 Press release of Bristol-Myers Squibb Company dated April 26, 2018.
99.2 Certain supplemental information posted on Bristol-Myers Squibb Company’s website at www.bms.com not included in the press release.
Exhibit 99.1
Bristol-Myers Squibb Reports First Quarter Financial Results
• Increases First Quarter Revenues 5% to $5.2 Billion• Posts First Quarter GAAP EPS of $0.91 and Non-GAAP EPS of $0.94• Achieves Important Clinical and Regulatory Milestones in Oncology
◦ Opdivoplus YervoyApproved in the U.S. for Patients with Intermediate- and Poor-Risk Advanced Renal Cell
Carcinoma◦ OpdivoFour-Week Dosing Approved in the U.S. and Europe◦ Applications for Opdivoplus Yervoyfor Previously Treated Patients with MSI-H or dMMR Metastatic Colorectal
Cancer and Opdivofor Previously Treated Patients with Small Cell Lung Cancer Accepted for Priority Reviews in
the U.S.◦ Presents Important New Data on Immuno-Oncology Portfolio at AACR Including Phase 3 Data for Opdivoplus
Yervoyin First-Line Advanced Non-Small Cell Lung Cancer Patients with High Tumor Mutational Burden• Announces Strategic Collaborations with Nektar Therapeutics, Janssen Pharmaceuticals and Illumina, Inc.• Updates 2018 GAAP and Non-GAAP EPS Guidance
( NEW YORK, April 26, 2018) - Bristol-Myers Squibb Company (NYSE:BMY) today reported results for the first quarter of
2018 which were highlighted by strong sales for Opdivo,Eliquis,and Orencia, important regulatory progress in Immuno-Oncology
and strategic business development transactions.
“We delivered strong commercial performance with continued growth for our key franchises, Opdivoand Eliquis, and
obtained FDA approval for Opdivoplus Yervoyin renal cell carcinoma, a disease with high unmet need which represents an
important opportunity for the company,” said Giovanni Caforio, M.D., chairman and chief executive officer, Bristol-Myers Squibb.
“I am confident that strong commercial execution, upcoming Phase 3 readouts across our oncology pipeline and continued strategic
use of business development position us well for future growth.”
First Quarter
$ amounts in millions, except per share amounts 2018 2017 Change
Total Revenues $ 5,193 $ 4,929 5 %GAAP Diluted EPS 0.91 0.94 (3)%Non-GAAP Diluted EPS 0.94 0.84 12 %
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FIRST QUARTER FINANCIAL RESULTS
• Bristol-Myers Squibb posted first quarter 2018 revenues of $5.2 billion, an increase of 5% compared to the same period a year
ago. Revenues increased 1% when adjusted for foreign exchange impact.
• U.S. revenues increased 1% to $2.8 billion in the quarter compared to the same period a year ago. International revenues
increased 10%. When adjusted for foreign exchange impact, international revenues increased 1%.
• Gross margin as a percentage of revenue decreased from 74.3% to 69.5% in the quarter primarily due to product mix.
• Marketing, selling and administrative expenses decreased 10% to $980 million in the quarter.
• Research and development expenses decreased 4% to $1.3 billion.
• The effective tax rate was 16.0% in the quarter, compared to 21.9% in the first quarter last year.
• The company reported net earnings attributable to Bristol-Myers Squibb of $1.5 billion, or $0.91 per share, in the first quarter
compared to net earnings of $1.6 billion, or $0.94 per share, for the same period in 2017.
• The company reported non-GAAP net earnings attributable to Bristol-Myers Squibb of $1.5 billion, or $0.94 per share, in the
first quarter, compared to $1.4 billion, or $0.84 per share, for the same period in 2017. An overview of specified items is
discussed under the “Use of Non-GAAP Financial Information” section.
• Cash, cash equivalents and marketable securities were $9.0 billion, with a net cash position of $1.3 billion, as of March 31, 2018.
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FIRST QUARTER PRODUCT AND PIPELINE UPDATE
ProductSales/BusinessHighlights
Global revenues for prioritized brands increased in the first quarter of 2018 by 21% compared to the first quarter of 2017, driven by:
Product Growth %Eliquis 37%Opdivo 34%Orencia 11%Sprycel (5)%Yervoy (25)%
Opdivo
Regulatory• In April, the European Commission approved an every four-week Opdivodosing schedule of 480 mg infused over 60
minutes as an option for patients with advanced melanoma and previously treated renal cell carcinoma (RCC) as well as the
approval of a two-week Opdivoflat dose option of 240 mg infused over 30 minutes to replace weight-based dosing for all six
approved monotherapy indications in the European Union.
• In April, the company announced the U.S. Food and Drug Administration (FDA) has accepted for priority review its
supplemental Biologics License Application (sBLA) for Opdivoto treat patients with small cell lung cancer (SCLC) whose
disease has progressed after two or more prior lines of therapy. The FDA action date is August 16, 2018.
• In April, the company announced the FDA approved the combination of Opdivoplus Yervoyfor previously untreated patients
with intermediate- and poor-risk advanced RCC.
• In March, the company announced the FDA accepted for priority review a sBLA for the Opdivoplus Yervoycombination for
the treatment of adults with microsatellite instability-high (MSI-H) or mismatch repair deficient (dMMR) metastatic
colorectal cancer (mCRC) that has progressed following treatment with a fluoropyrimidine, oxaliplatin and irinotecan. The
FDA action date is July 10, 2018.
• In March, the company announced the FDA approved a sBLA updating the Opdivodosing schedule to include 480 mg
infused every four weeks for a majority of approved indications as well as a shorter 30 minute infusion across all approved
indications.
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Clinical• In April, at the American Association for Cancer Research (AACR) Annual Meeting, the company presented results from
numerous studies of novel agents and Opdivo-based combinations. Key clinical data presented at the meeting include:◦ CheckMate -227: First presentation of data from the Phase 3 study assessing the Opdivoplus Yervoycombination
versus platinum-doublet chemotherapy in first-line advanced non-small cell lung cancer (NSCLC) patients with high
tumor mutational burden (≥10 mutations/megabase). (link)◦ CheckMate -568: First presentation of data from a Phase 2 study evaluating Opdivoplus Yervoyin treatment naïve
patients with advanced NSCLC. Results demonstrated Opdivo3 mg/kg plus low-dose Yervoy(1mg/kg) identified
high tumor mutational burden of ≥10 mutations/megabase (mut/Mb) as an effective cutoff for selecting which
patients were most likely to respond to first-line treatment of Opdivoplus Yervoyregardless of tumor PD-L1
expression.◦ CheckMate -078: First presentation of data from the Phase 3 study evaluating Opdivomonotherapy versus docetaxel
in a predominantly Chinese patient population with previously treated advanced NSCLC. (link)◦ CheckMate -141: Announced a two-year overall survival (OS) update from the Phase 3 study evaluating patients
treated with Opdivo over standard of care in patients with recurrent or metastatic squamous cell carcinoma of the
head and neck (SCCHN) after failure on platinum-based therapy. (link)
Eliquis
Clinical• In March, at the American College of Cardiology’s 67 th Annual Scientific Session & Expo, the company and Pfizer Inc.
announced the largest real-world data analysis from studies evaluating different direct oral anticoagulants, including Eliquis,
rivaroxaban and dabigatran, for non-valvular atrial fibrillation patients. (link)
FIRST QUARTER BUSINESS DEVELOPMENT UPDATE
• In April, the company and Illumina, Inc. announced a collaboration that will utilize Illumina’s next-generation sequencing
technology to develop and globally commercialize in-vitro diagnostic assays in support of Bristol-Myers Squibb’s oncology
portfolio.
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• In April, the company and Janssen Pharmaceutical Companies of Johnson & Johnson announced a worldwide collaboration
to develop and commercialize Bristol-Myers Squibb’s Factor XIa inhibitor program, including BMS-986177, an
anticoagulant compound being studied for prevention and treatment of major thrombotic conditions.
• In April, the company and the Harvard Fibrosis Network of the Harvard Stem Cell Institute announced a research
collaboration to discover and develop potential new therapies for fibrotic diseases, including fibrosis of the liver and heart.
• In February, the company announced that Yale Cancer Center will join the International Immuno-Oncology Network, a
global peer-to-peer collaboration between Bristol-Myers Squibb and academia that aims to advance translational Immuno-
Oncology science.
• In February, the company and Nektar Therapeutics announced a global strategic development and commercialization
collaboration for Nektar’s lead Immuno-Oncology program, NKTR-214. The companies will jointly develop and
commercialize NKTR-214 in combination with Opdivoand Opdivoplus Yervoyin more than 20 indications across nine
tumor types.
2018 FINANCIAL GUIDANCE
Bristol-Myers Squibb is decreasing its 2018 GAAP EPS guidance range from $3.00 - $3.15 to $2.70 - $2.80 and increasing
its non-GAAP EPS guidance range from $3.15 - $3.30 to $3.35 - $3.45. Both GAAP and non-GAAP guidance assume current
exchange rates. Key revised 2018 GAAP and non-GAAP line-item guidance assumptions are:
• Worldwide revenues increasing in the mid-single digits.• Research and development expenses increasing in the low-single digits for GAAP.• An effective tax rate between 17% and 18% for both GAAP and non-GAAP.
The financial guidance for 2018 excludes the impact of any potential future strategic acquisitions and divestitures, and any
specified items that have not yet been identified and quantified. The non-GAAP 2018 guidance also excludes other specified items
as discussed under “Use of Non-GAAP Financial Information.” Details reconciling adjusted non-GAAP amounts with the amounts
reflecting specified items are provided in supplemental materials available on the company’s website.
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Use of Non-GAAP Financial Information
This press release contains non-GAAP financial measures, including non-GAAP earnings and related EPS information, that areadjusted to exclude certain costs, expenses, gains and losses and other specified items that are evaluated on an individual basis.These items are adjusted after considering their quantitative and qualitative aspects and typically have one or more of the followingcharacteristics, such as being highly variable, difficult to project, unusual in nature, significant to the results of a particular period ornot indicative of future operating results. Similar charges or gains were recognized in prior periods and will likely reoccur in futureperiods including restructuring costs, accelerated depreciation and impairment of property, plant and equipment and intangibleassets, R&D charges in connection with the acquisition or licensing of third party intellectual property rights, divestiture and equityinvestment gains or losses, upfront payments from out-licensed assets, pension charges, legal and other contractual settlements anddebt redemption gains or losses, among other items. Deferred and current income taxes attributed to these items are also adjusted forconsidering their individual impact to the overall tax expense, deductibility and jurisdictional tax rates. Non-GAAP information isintended to portray the results of our baseline performance, supplement or enhance management, analysts and investors overallunderstanding of our underlying financial performance and facilitate comparisons among current, past and future periods. Forexample, non-GAAP earnings and EPS information is an indication of our baseline performance before items that are considered byus to not be reflective of our ongoing results. In addition, this information is among the primary indicators we use as a basis forevaluating performance, allocating resources, setting incentive compensation targets and planning and forecasting for future periods.This information is not intended to be considered in isolation or as a substitute for net earnings or diluted EPS prepared inaccordance with GAAP.
Statement on Cautionary Factors
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of1995 regarding, among other things, statements relating to goals, plans and projections regarding the company’s financial position,results of operations, market position, product development and business strategy. These statements may be identified by the factthat they use words such as "anticipate", "estimates", "should", "expect", "guidance", "project", "intend", "plan", "believe" and otherwords and terms of similar meaning in connection with any discussion of future operating or financial performance. Such forward-looking statements are based on current expectations and involve inherent risks and uncertainties, including factors that could delay,divert or change any of them, and could cause actual outcomes and results to differ materially from current expectations. Thesefactors include, among other things, effects of the continuing implementation of governmental laws and regulations related toMedicare, Medicaid, Medicaid managed care organizations and entities under the Public Health Service 340B program,pharmaceutical rebates and reimbursement, market factors, competitive product development and approvals, pricing controls andpressures (including changes in rules and practices of managed care groups and institutional and governmental purchasers),economic conditions such as interest rate and currency exchange rate fluctuations, judicial decisions, claims and concerns that mayarise regarding the safety and efficacy of in-line products and product candidates, changes to wholesaler inventory levels, variabilityin data provided by third parties, changes in, and interpretation of, governmental regulations and legislation affecting domestic orforeign operations, including tax obligations, changes to business or tax planning strategies, difficulties and delays in productdevelopment, manufacturing or sales including any potential future recalls, patent positions and the ultimate outcome of anylitigation matter. These factors also include the company’s ability to successfully execute its strategic plans, including its businessdevelopment strategy, the expiration of patents or data protection on certain products, including assumptions about the company’sability to retain patent exclusivity of certain products, and the impact and result of governmental investigations.
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There can be no guarantees with respect to pipeline products that future clinical studies will support the data described in thisrelease, that the compounds will receive necessary regulatory approvals, or that they will prove to be commercially successful; norare there guarantees that regulatory approvals will be sought, or sought within currently expected timeframes, or that contractualmilestones will be achieved. For further details and a discussion of these and other risks and uncertainties, see the company'speriodic reports, including the annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, filedwith or furnished to the Securities and Exchange Commission. The company undertakes no obligation to publicly update anyforward-looking statement, whether as a result of new information, future events or otherwise.
Company and Conference Call Information
Bristol-Myers Squibb is a global biopharmaceutical company whose mission is to discover, develop and deliver innovative
medicines that help patients prevail over serious diseases. For more information about Bristol-Myers Squibb, visit us at BMS.com or
follow us on LinkedIn, Twitter, YouTube and Facebook.
There will be a conference call on April 26, 2018 at 10:30 a.m. EDT during which company executives will review financial
information and address inquiries from investors and analysts. Investors and the general public are invited to listen to a live webcast
of the call at http://investor.bms.com or by calling the U.S. toll free 866-548-4713 or international 323-794-2093, confirmation code:
4713257. Materials related to the call will be available at the same website prior to the conference call. A replay of the call will be
available beginning at 1:30 p.m. EDT on April 26, 2018 through 1:30 p.m. EDT on May 10, 2018. The replay will also be available
through http://investor.bms.com or by calling the U.S. toll free 888-203-1112 or international 719-457-0820, confirmation code:
4713257.
For more information, contact: Communications: Ken Dominski, 609-252-5251, [email protected] or Lisa
McCormick Lavery, 609-252-7602, [email protected]; Investor Relations: John Elicker, 609-252-4611,
[email protected], Tim Power, 609-252-7509, [email protected] or Bill Szablewski, 609-252-5894,
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BRISTOL-MYERS SQUIBB COMPANYPRODUCT REVENUE
FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017(Unaudited, dollars in millions)
Worldwide Revenues U.S. Revenues
2018 2017 %
Change 2018 2017 %
ChangeThree Months Ended March 31, Prioritized Brands
Opdivo $ 1,511 $ 1,127 34 % $ 938 $ 761 23 %Eliquis 1,506 1,101 37 % 885 699 27 %Orencia 593 535 11 % 385 362 6 %Sprycel 438 463 (5)% 214 247 (13)%Yervoy 249 330 (25)% 162 243 (33)%Empliciti 55 53 4 % 37 36 3 %
Established Brands Baraclude 225 282 (20)% 10 14 (29)%Sustiva Franchise 84 184 (54)% 10 153 (93)%Reyataz Franchise 124 193 (36)% 51 88 (42)%Hepatitis C Franchise 3 162 (98)% 5 42 (88)%Other Brands 405 499 (19)% 81 93 (13)%
Total $ 5,193 $ 4,929 5 % $ 2,778 $ 2,738 1 %
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BRISTOL-MYERS SQUIBB COMPANYCONSOLIDATED STATEMENTS OF EARNINGS
FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017(Unaudited, dollars and shares in millions except per share data)
Three Months Ended March
31,
2018 2017Net product sales $ 4,972 $ 4,580Alliance and other revenues 221 349Total Revenues 5,193 4,929 Cost of products sold 1,584 1,265Marketing, selling and administrative 980 1,085Research and development 1,250 1,303Other income (net) (400) (679)Total Expenses 3,414 2,974 Earnings Before Income Taxes 1,779 1,955Provision for Income Taxes 284 429 Net Earnings 1,495 1,526Net Earnings/(Loss) Attributable to Noncontrolling Interest 9 (48)
Net Earnings Attributable to BMS $ 1,486 $ 1,574
Average Common Shares Outstanding:
Basic 1,633 1,662Diluted 1,640 1,671
Earnings per Common Share
Basic $ 0.91 $ 0.95Diluted $ 0.91 $ 0.94
Other income (net)
Interest expense $ 46 $ 45Investment income (36) (26)Equity investment gains (15) (7)Provision for restructuring 20 164Litigation and other settlements — (484)Equity in net income of affiliates (24) (18)Divestiture gains (45) (127)Royalties and licensing income (367) (199)Transition and other service fees (4) (7)Pension and postretirement (11) 1Intangible asset impairment 64 —Other (28) (21)
Other income (net) $ (400) $ (679)
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BRISTOL-MYERS SQUIBB COMPANYSPECIFIED ITEMS
FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017(Unaudited, dollars in millions)
Three Months Ended March
31,
2018 2017
Impairment charges $ 10 $ —Accelerated depreciation and other shutdown costs 3 —Cost of products sold 13 — Marketing, selling and administrative 1 — License and asset acquisition charges 60 50IPRD impairments — 75Site exit costs and other 20 72Research and development 80 197 Equity investment gains (15) —Provision for restructuring 20 164Litigation and other settlements — (481)Divestiture gains (43) (100)Royalties and licensing income (50) —Pension charges 31 33Intangible asset impairment 64 —Other income (net) 7 (384)
Increase/(decrease) to pretax income 101 (187)
Income taxes on specified items (8) 72U.S. tax reform provisional amount adjustment (32) —Income taxes (40) 72
Increase/(decrease) to net earnings 61 (115)
Noncontrolling interest — (59)
Increase/(decrease) to net earnings used for diluted Non-GAAP EPS calculation $ 61 $ (174)
10
BRISTOL-MYERS SQUIBB COMPANYRECONCILIATION OF CERTAIN GAAP LINE ITEMS TO CERTAIN NON-GAAP LINE ITEMS
FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017(Unaudited, dollars in millions)
Three Months Ended March 31, 2018
GAAP SpecifiedItems (a)
Non-GAAP
Gross Profit $ 3,609 $ 13 $ 3,622
Marketing, selling and administrative 980 (1) 979
Research and development 1,250 (80) 1,170
Other income (net) (400) (7) (407)
Earnings Before Income Taxes 1,779 101 1,880
Provision for Income Taxes 284 (40) 324
Noncontrolling interest 9 — 9
Net Earnings Attributable to BMS used for Diluted EPS Calculation $ 1,486 $ 61 $ 1,547
Average Common Shares Outstanding - Diluted 1,640 1,640 1,640
Diluted Earnings Per Share $ 0.91 $ 0.03 $ 0.94
Effective Tax Rate 16.0% 1.2 % 17.2%
Three Months Ended March 31, 2017
GAAP Specified Items (a)
Non- GAAP
Gross Profit $ 3,664 $ — $ 3,664
Marketing, selling and administrative 1,085 — 1,085
Research and development 1,303 (197) 1,106
Other income (net) (679) 384 (295)
Earnings Before Income Taxes 1,955 (187) 1,768
Provision for Income Taxes 429 72 357
Noncontrolling interest (48) (59) 11
Net Earnings/(Loss) Attributable to BMS used for Diluted EPS Calculation $ 1,574 $ (174) $ 1,400
Average Common Shares Outstanding - Diluted 1,671 1,671 1,671
Diluted Earnings/(Loss) Per Share $ 0.94 $ (0.10) $ 0.84
Effective Tax Rate 21.9% (1.7)% 20.2%
(a) Refer to the Specified Items schedule for further details. Effective tax rate on the Specified Items represents the difference between the GAAP and Non-GAAP effective tax rate.
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BRISTOL-MYERS SQUIBB COMPANYNET CASH/(DEBT) CALCULATION
AS OF MARCH 31, 2018 AND DECEMBER 31, 2017(Unaudited, dollars in millions)
March 31, 2018 December 31, 2017Cash and cash equivalents $ 5,342 $ 5,421Marketable securities - current 1,428 1,391Marketable securities - non-current 2,252 2,480
Cash, cash equivalents and marketable securities 9,022 9,292Short-term debt obligations (1,925) (987)Long-term debt (5,775) (6,975)
Net cash position $ 1,322 $ 1,330
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Exhibit 99.2
BRISTOL-MYERS SQUIBB COMPANYQUARTERLY TREND ANALYSIS OF REVENUES
(Unaudited, dollars in millions)
Revenues 2017 2018 % Change FX Impact
1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2ndQtr 6
Months 3rdQtr 9
Months 4thQtr Year Qtr vs.
Qtr YTDvs.
YTD Qtr vs.Qtr
YTDvs.
YTD
United States $ 2,738 $ 2,865 $ 5,603 $ 2,864 $ 8,467 $ 2,891 $ 11,358 $ 2,778 1 % 1 % — —
Europe 1,146 1,188 2,334 1,262 3,596 1,392 4,988 1,406 23 % 23 % 15% 15% Rest of theWorld 925 963 1,888 970 2,858 1,019 3,877 873 (6)% (6)% 3% 3%
Other 120 128 248 158 406 147 553 136 13 % 13 % N/A N/A
Total $ 4,929 $ 5,144 $ 10,073 $ 5,254 $ 15,327 $ 5,449 $ 20,776 $ 5,193 5 % 5 % 4% 4%
% of Revenues 2017 2018
1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2ndQtr 6
Months 3rdQtr 9
Months 4thQtr Year
United States 55.5% 55.7% 55.6% 54.5% 55.2% 53.1% 54.7% 53.5%
Europe 23.3% 23.1% 23.2% 24.0% 23.5% 25.5% 24.0% 27.1% Rest of theWorld 18.8% 18.7% 18.7% 18.5% 18.6% 18.7% 18.7% 16.8%
Other 2.4% 2.5% 2.5% 3.0% 2.7% 2.7% 2.6% 2.6%
Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
1
BRISTOL-MYERS SQUIBB COMPANYEARNINGS FROM OPERATIONS
(Unaudited, dollars and shares in millions except per share data)
2017 2018 % Change
1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2nd Qtr 6Months 3rd Qtr 9 Months 4th Qtr Year Qtr vs. Qtr YTD vs.
YTDNet productsales $ 4,580 $ 4,770 $ 9,350 $ 4,862 $ 14,212 $ 5,046 $ 19,258 $ 4,972 9 % 9 %Alliance andother revenues 349 374 723 392 1,115 403 1,518 221 (37)% (37)%
Total Revenues $ 4,929 $ 5,144 $ 10,073 $ 5,254 $ 15,327 $ 5,449 $ 20,776 $ 5,193 5 % 5 %
Cost of productssold 1,265 1,568 2,833 1,579 4,412 1,680 6,092 1,584 25 % 25 %Marketing,selling andadministrative 1,085 1,178 2,263 1,158 3,421 1,312 4,733 980 (10)% (10)%Research anddevelopment 1,303 1,675 2,978 1,559 4,537 1,937 6,474 1,250 (4)% (4)%Other income(net) (679) (572) (1,251) (225) (1,476) (178) (1,654) (400) (41)% (41)%
Total Expenses 2,974 3,849 6,823 4,071 10,894 4,751 15,645 3,414 15 % 15 %
EarningsBefore IncomeTaxes $ 1,955 $ 1,295 $ 3,250 $ 1,183 $ 4,433 $ 698 $ 5,131 $ 1,779 (9)% (9)%Provision forIncome Taxes 429 373 802 327 1,129 3,027 4,156 284 (34)% (34)%NetEarnings/(Loss) $ 1,526 $ 922 $ 2,448 $ 856 $ 3,304 $ (2,329) $ 975 $ 1,495 (2)% (2)%NetEarnings/(Loss)Attributable toNoncontrollingInterest (48) 6 (42) 11 (31) (1) (32) 9 ** **NetEarnings/(Loss)Attributable toBMS $ 1,574 $ 916 $ 2,490 $ 845 $ 3,335 $ (2,328) $ 1,007 $ 1,486 (6)% (6)%
DilutedEarnings/(Loss)per CommonShare* $ 0.94 $ 0.56 $ 1.50 $ 0.51 $ 2.02 $ (1.42) $ 0.61 $ 0.91 (3)% (3)%AverageCommon SharesOutstanding -Diluted 1,671 1,650 1,660 1,645 1,655 1,635 1,652 1,640 (2)% (2)%Dividendsdeclared percommon share $ 0.39 $ 0.39 $ 0.78 $ 0.39 $ 1.17 $ 0.40 $ 1.57 $ 0.40 3 % 3 %
2017 2018 % of TotalRevenues 1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2nd Qtr 6
Months 3rd Qtr 9 Months 4th Qtr Year
Gross Margin 74.3% 69.5% 71.9% 69.9% 71.2% 69.2% 70.7% 69.5%
Other Ratios
Effective tax rate 21.9% 28.8% 24.7% 27.6% 25.5% 433.7% 81.0% 16.0% Other income(net) 2017 2018 % Change
1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2nd Qtr 6Months 3rd Qtr 9 Months 4th Qtr Year Qtr vs. Qtr YTD vs.
YTDInterest expense $ 45 $ 52 $ 97 $ 48 $ 145 $ 51 $ 196 $ 46 2 % 2 %Investmentincome (26) (29) (55) (32) (87) (39) (126) (36) 38 % 38 %Equityinvestment gains (7) (5) (12) (5) (17) (11) (28) (15) ** **Provision forrestructuring 164 15 179 28 207 86 293 20 (88)% (88)%Litigation andother settlements (484) (5) (489) — (489) 2 (487) — (100)% (100)%Equity in netincome ofaffiliates (18) (20) (38) (21) (59) (16) (75) (24) 33 % 33 %Divestiture(gains)/losses (127) — (127) 1 (126) (38) (164) (45) (65)% (65)%Royalties andlicensing income (199) (685) (884) (209) (1,093) (258) (1,351) (367) 84 % 84 %Transition andother servicefees (7) (13) (20) (12) (32) (5) (37) (4) (43)% (43)%
Pension andpostretirement 1 3 4 (12) (8) 35 27 (11) ** **Intangible assetimpairment — — — — — — — 64 N/A N/AEquityinvestmentimpairment — — — — — 5 5 — — —Loss on debtredemption — 109 109 — 109 — 109 — — —Other (21) 6 (15) (11) (26) 10 (16) (28) 33 % 33 %
$ (679) $ (572) $ (1,251) $ (225) $ (1,476) $ (178) $ (1,654) $ (400) (41)% (41)%
* Quarterly amounts may not add to the year-to-date totals due to rounding of individual calculations.** In excess of +/- 100%
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BRISTOL-MYERS SQUIBB COMPANYRECONCILIATION OF GAAP AND NON-GAAP GROWTH DOLLARS AND PERCENTAGES EXCLUDING FOREIGN EXCHANGE IMPACT
FOR THE PERIOD ENDED MARCH 31, 2018(Unaudited, dollars in millions)
QUARTER-TO-DATE 2018 2017 Growth $ Growth %
Favorable /(Unfavorable)FX Impact $ *
2018Excluding FX
Favorable /(Unfavorable)
FX Impact % * Growth %
Excluding FX
Revenues $ 5,193 $ 4,929 $ 264 5 % $ 201 $ 4,992 4 % 1 %
Gross profit 3,609 3,664 (55) (2)% N/A N/A N/A N/A
Gross profit excluding specified items (a) 3,622 3,664 (42) (1)% N/A N/A N/A N/A
Gross profit excluding specified items as a% of revenues 69.7% 74.3%
Marketing, selling and administrative 980 1,085 (105) (10)% (35) 945 (3)% (13)%Marketing, selling and administrative excludingspecified items (a) 979 1,085 (106) (10)% (35) 944 (3)% (13)%
Marketing, selling and administrativeexcluding specified items as a % ofrevenues 18.9% 22.0%
Research and development 1,250 1,303 (53) (4)% (22) 1,228 (2)% (6)%Research and development excluding specifieditems (a) 1,170 1,106 64 6 % (16) 1,154 (2)% 4 %
Research and development excludingspecified items as a % of revenues 22.5% 22.4%
(a) Refer to the Specified Items schedule for further details. * Foreign exchange impacts were derived by applying the prior period average currency rates to the current period sales and expenses.
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BRISTOL-MYERS SQUIBB COMPANYWORLDWIDE REVENUES
QUARTERLY REVENUES TREND ANALYSIS(Unaudited, dollars in millions)
2017 2018 Growth $ % Change
1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2nd Qtr 6Months 3rd Qtr 9
Months 4th Qtr Year Qtr vs.Qtr
YTDvs.
YTD Qtr vs.Qtr YTD vs.
YTD
Prioritized Brands
Opdivo $ 1,127 $ 1,195 $ 2,322 $ 1,265 $ 3,587 $ 1,361 $ 4,948 $ 1,511 $ 384 $ 384 34 % 34 %
Eliquis 1,101 1,176 2,277 1,232 3,509 1,363 4,872 1,506 405 405 37 % 37 %
Orencia (a) 535 650 1,185 632 1,817 662 2,479 593 58 58 11 % 11 %
Sprycel 463 506 969 509 1,478 527 2,005 438 (25) (25) (5)% (5)%
Yervoy 330 322 652 323 975 269 1,244 249 (81) (81) (25)% (25)%
Empliciti 53 55 108 60 168 63 231 55 2 2 4 % 4 %
Established Brands
Baraclude 282 273 555 264 819 233 1,052 225 (57) (57) (20)% (20)%Sustiva Franchise(b) 184 188 372 183 555 174 729 84 (100) (100) (54)% (54)%
Reyataz Franchise 193 188 381 174 555 143 698 124 (69) (69) (36)% (36)%Hepatitis CFranchise (c) 162 112 274 73 347 59 406 3 (159) (159) (98)% (98)%
Other Brands 499 479 978 539 1,517 595 2,112 405 (94) (94) (19)% (19)%
Total $ 4,929 $ 5,144 $ 10,073 $ 5,254 $ 15,327 $ 5,449 $ 20,776 $ 5,193 $ 264 $ 264 5 % 5 %
(a) Includes Orencia SubQ revenues of $295 million and $244 million for the three months ended March 31, 2018 and 2017, respectively.(b) The Sustiva Franchise includes sales of Sustiva, BMS's share of Atripla revenues in Europe, and U.S. Atripla royalty revenue beginning January 1, 2018.(c) Includes Daklinza (daclatasvir) and Sunvepra (asunaprevir) revenues.
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BRISTOL-MYERS SQUIBB COMPANYU.S. REVENUES
QUARTERLY REVENUES TREND ANALYSIS(Unaudited, dollars in millions)
2017 2018 % Change
1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year Qtr vs. Qtr YTD vs.YTD
PrioritizedBrands
Opdivo $ 761 $ 768 $ 1,529 $ 778 $ 2,307 $ 795 $ 3,102 $ 938 23 % 23 %
Eliquis 699 703 1,402 717 2,119 768 2,887 885 27 % 27 %Orencia(a) 362 449 811 432 1,243 461 1,704 385 6 % 6 %
Sprycel 247 281 528 278 806 299 1,105 214 (13)% (13)%
Yervoy 243 245 488 239 727 181 908 162 (33)% (33)%
Empliciti 36 37 73 39 112 39 151 37 3 % 3 %EstablishedBrands
Baraclude 14 12 26 14 40 13 53 10 (29)% (29)%SustivaFranchise(b) 153 161 314 157 471 151 622 10 (93)% (93)%ReyatazFranchise 88 87 175 85 260 67 327 51 (42)% (42)%HepatitisCFranchise(c) 42 30 72 24 96 13 109 5 (88)% (88)%OtherBrands 93 92 185 101 286 104 390 81 (13)% (13)%
Total (d) $ 2,738 $ 2,865 $ 5,603 $ 2,864 $ 8,467 $ 2,891 $ 11,358 $ 2,778 1 % 1 %
(a) Includes Orencia SubQ revenues of $165 million and $146 million for the three months ended March 31, 2018 and 2017, respectively.(b) In 2018, U.S. Sustiva Franchise revenues include sales of Sustiva only.(c) Includes revenues of Daklinza (daclastasvir) only.(d) Includes United States and Puerto Rico.
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BRISTOL-MYERS SQUIBB COMPANYINTERNATIONAL REVENUES
QUARTERLY REVENUES TREND ANALYSIS(Unaudited, dollars in millions)
2017 2018 % Change
1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year Qtr vs. Qtr YTD vs.YTD
PrioritizedBrands
Opdivo $ 366 $ 427 $ 793 $ 487 $ 1,280 $ 566 $ 1,846 $ 573 57 % 57 %
Eliquis 402 473 875 515 1,390 595 1,985 621 54 % 54 %
Orencia 173 201 374 200 574 201 775 208 20 % 20 %
Sprycel 216 225 441 231 672 228 900 224 4 % 4 %
Yervoy 87 77 164 84 248 88 336 87 — —
Empliciti 17 18 35 21 56 24 80 18 6 % 6 %EstablishedBrands
Baraclude 268 261 529 250 779 220 999 215 (20)% (20)%SustivaFranchise(a) 31 27 58 26 84 23 107 74 ** **ReyatazFranchise 105 101 206 89 295 76 371 73 (30)% (30)%HepatitisCFranchise(b) 120 82 202 49 251 46 297 (2) ** **OtherBrands 406 387 793 438 1,231 491 1,722 324 (20)% (20)%
Total (c) $ 2,191 $ 2,279 $ 4,470 $ 2,390 $ 6,860 $ 2,558 $ 9,418 $ 2,415 10 % 10 %
** In excess of +/- 100%(a) The Sustiva Franchise includes BMS's share of Atripla revenues in Europe, and U.S. Atripla royalty revenue beginning January 1, 2018.(b) Includes Daklinza (daclatasvir) and Sunvepra (asunaprevir) revenues.(c) When adjusted for foreign exchange impact, total revenues increased 1% for the first quarter.
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BRISTOL-MYERS SQUIBB COMPANYSPECIFIED ITEMS
(Unaudited, dollars in millions)
2017 2018
1st Qtr 2nd Qtr 6
Months 3rd Qtr 9
Months 4th Qtr Year 1st Qtr 2nd Qtr 6
Months 3rd Qtr 9
Months 4th Qtr Year
Impairment charges $ — $ 127 $ 127 $ 1 $ 128 $ 18 $ 146 $ 10 Accelerated depreciation andother shutdown costs — 3 3 — 3 — 3 3
Cost of products sold — 130 130 1 131 18 149 13 Marketing, selling andadministrative — — — — — 1 1 1 License and asset acquisitioncharges 50 393 443 310 753 377 1,130 60
IPRD impairments 75 — 75 — 75 — 75 —
Site exit costs and other 72 96 168 64 232 151 383 20
Research and development 197 489 686 374 1,060 528 1,588 80 Equity investment gains — — — — — — — (15)
Provision for restructuring 164 15 179 28 207 86 293 20 Litigation and othersettlements (481) — (481) — (481) — (481) —
Divestiture gains (100) — (100) — (100) (26) (126) (43) Royalties and licensingincome — (497) (497) — (497) — (497) (50)
Pension charges 33 36 69 22 91 71 162 31
Intangible asset impairment — — — — — — — 64
Loss on debt redemption — 109 109 — 109 — 109 —
Other income (net) (384) (337) (721) 50 (671) 131 (540) 7 Increase/(decrease) topretax income (187) 282 95 425 520 678 1,198 101 Income taxes on specifieditems 72 20 92 (41) 51 (138) (87) (8) Income taxes attributed toU.S. tax reform — — — — — 2,911 2,911 — U.S. tax reform provisionalamount adjustment — — — — — — — (32)
Income taxes 72 20 92 (41) 51 2,773 2,824 (40) Increase/(decrease) to netearnings (115) 302 187 384 571 3,451 4,022 61 Noncontrolling interest (59) — (59) — (59) — (59) — Increase/(decrease) to netearnings used for dilutedNon-GAAP EPS calculation $ (174) $ 302 $ 128 $ 384 $ 512 $3,451 $3,963 $ 61
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BRISTOL-MYERS SQUIBB COMPANYRECONCILIATION OF CERTAIN GAAP LINE ITEMS TO CERTAIN NON-GAAP LINE ITEMS
(Unaudited, dollars in millions)
2017 2018
1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year
Gross Profit $ 3,664 $ 3,576 $ 7,240 $ 3,675 $ 10,915 $ 3,769 $ 14,684 $ 3,609
Specified items (a) — 130 130 1 131 18 149 13 Gross profit excluding specifieditems 3,664 3,706 7,370 3,676 11,046 3,787 14,833 3,622 Marketing, selling andadministrative 1,085 1,178 2,263 1,158 3,421 1,312 4,733 980
Specified items (a) — — — — — (1) (1) (1) Marketing, selling andadministrative excluding specifieditems 1,085 1,178 2,263 1,158 3,421 1,311 4,732 979
Research and development 1,303 1,675 2,978 1,559 4,537 1,937 6,474 1,250
Specified items (a) (197) (489) (686) (374) (1,060) (528) (1,588) (80) Research and developmentexcluding specified items 1,106 1,186 2,292 1,185 3,477 1,409 4,886 1,170
Other income (net) (679) (572) (1,251) (225) (1,476) (178) (1,654) (400)
Specified items (a) 384 337 721 (50) 671 (131) 540 (7) Other income (net) excludingspecified items (295) (235) (530) (275) (805) (309) (1,114) (407)
(a) Refer to the Specified Items schedule for further details.
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BRISTOL-MYERS SQUIBB COMPANYRECONCILIATION OF GAAP TO NON-GAAP EPS
(Unaudited, dollars in millions)
2017 2018
1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year 1st Qtr 2nd Qtr 6 Months 3rd Qtr 9 Months 4th Qtr Year
Earnings before income taxes $ 1,955 $ 1,295 $ 3,250 $ 1,183 $ 4,433 $ 698 $ 5,131 $ 1,779
Specified items (a) (187) 282 95 425 520 678 1,198 101 Earnings before income taxesexcluding specified items 1,768 1,577 3,345 1,608 4,953 1,376 6,329 1,880
Provision for income taxes 429 373 802 327 1,129 3,027 4,156 284
Tax on specified items (a) 72 20 92 (41) 51 (138) (87) (8) Income taxes attributed to U.S.tax reform (a) — — — — — 2,911 2,911 — U.S. tax reform provisionalamount adjustment (a) — — — — — — — (32) Provision for income taxesexcluding tax on specified itemsand income taxes attributed toU.S. tax reform 357 353 710 368 1,078 254 1,332 324 Net Earnings/(Loss)Attributable to NoncontrollingInterest (48) 6 (42) 11 (31) (1) (32) 9
Specified items (a) (59) — (59) — (59) — (59) — Net Earnings/(Loss)Attributable to NoncontrollingInterest excluding specifieditems 11 6 17 11 28 (1) 27 9 Net Earnings/(Loss)Attributable to BMS used forDiluted EPS Calculation -GAAP 1,574 916 2,490 845 3,335 (2,328) 1,007 1,486
Specified items (a) (174) 302 128 384 512 3,451 3,963 61 Net Earnings Attributable toBMS used for Diluted EPSCalculation excluding specifieditems - Non-GAAP 1,400 1,218 2,618 1,229 3,847 1,123 4,970 1,547 Weighted-average CommonShares Outstanding - Diluted-GAAP 1,671 1,650 1,660 1,645 1,655 1,635 1,652 1,640 Weighted-average CommonShares Outstanding - Diluted-Non-GAAP 1,671 1,650 1,660 1,645 1,655 1,642 1,652 1,640 Diluted Earnings/(Loss) PerShare - GAAP $ 0.94 $ 0.56 $ 1.50 $ 0.51 $ 2.02 $ (1.42) $ 0.61 $ 0.91 Diluted Earnings/(Loss) PerShare Attributable to SpecifiedItems (0.10) 0.18 0.08 0.24 0.30 2.10 2.40 0.03 Diluted Earnings Per Share -Non-GAAP $ 0.84 $ 0.74 $ 1.58 $ 0.75 $ 2.32 $ 0.68 $ 3.01 $ 0.94
Effective Tax Rate 21.9 % 28.8 % 24.7 % 27.6 % 25.5 % 433.7 % 81.0 % 16.0%
Specified items (a) (1.7)% (6.4)% (3.5)% (4.7)% (3.7)% (415.2)% (60.0)% 1.2% Effective Tax Rate excludingspecified items 20.2 % 22.4 % 21.2 % 22.9 % 21.8 % 18.5 % 21.0 % 17.2%
(a) Refer to the Specified Items schedule for further details. Effective tax rate on the Specified Items represents the difference between the GAAP and Non-GAAP effective tax rate.
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BRISTOL-MYERS SQUIBB COMPANYSELECTED BALANCE SHEET INFORMATION
(Unaudited, dollars in millions)
March 31,
2017 June 30,
2017 September 30,
2017 December 31,
2017 March 31,
2018 June 30,
2018 September 30,
2018 December 31,
2018Cash and cash equivalents $ 3,910 $ 3,470 $ 4,644 $ 5,421 $ 5,342 Marketable securities - current 2,199 3,035 2,478 1,391 1,428 Marketable securities - non-current 2,685 2,580 2,526 2,480 2,252 Cash, cash equivalents and marketablesecurities 8,794 9,085 9,648 9,292 9,022
Short-term debt obligations (1,197) (1,306) (1,461) (987) (1,925) Long-term debt (7,237) (6,911) (6,982) (6,975) (5,775)
Net cash position $ 360 $ 868 $ 1,205 $ 1,330 $ 1,322
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BRISTOL-MYERS SQUIBB COMPANY2018 FULL YEAR PROJECTED DILUTED EPS FROM OPERATIONS
EXCLUDING PROJECTED SPECIFIED ITEMS
Full Year 2018 Pre-tax Tax After-tax
Projected Diluted Earnings Attributable to Shareholders per Common Share - GAAP $2.70 to
$2.80 Projected Specified Items: Restructuring, accelerated depreciation and other exit costs (1) 0.14 0.03 0.11 Divestiture gains and licensing income (0.14) (0.04) (0.10) Research and development license and asset acquisition charges 0.71 0.13 0.58 Pension charges 0.07 0.01 0.06 Other 0.03 0.03 — Total 0.81 0.16 0.65 Projected Diluted Earnings Attributable to Shareholders per Common Share - Non-GAAP
$3.35 to$3.45
(1) Includes items recognized in Cost of products sold, Research and development and Other income (net).
The following table summarizes the company's 2018 financial guidance:
Line item GAAP Non-GAAP
Gross margin as a percent of revenue Approximately 70% Approximately 70% Marketing, selling and administrative expense Decreasing in the low- to mid-single digit range Decreasing in the low- to mid-single digit range Research and development expense Increasing in the low-single digits Increasing in the high-single digits Effective tax rate Between 17%-18% Between 17%-18%
The GAAP financial results for the full year 2018 will include specified items, including charges associated with restructuring, downsizing and streamlining worldwide operations, gains ondivestitures and equity investments, license and asset acquisition charges, pension charges and other specified items that have not yet been identified and quantified, including litigation andother settlements, licensed asset impairments and finalization of the deemed repatriation tax, among other items. For a fuller discussion of items that could impact full year GAAP results, aswell as the use of non-GAAP financial information, see Bristol-Myers Squibb Reports First Quarter 2018 Financial Results, April 26, 2018 including “2018 Financial Guidance” and “Use ofnon-GAAP Financial Information” therein.
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