Bristol-Myers Squibb Company
) received some encouraging news when the U.S. Food and Drug
Administration (FDA) cleared a biologics manufacturing facility of
the company for producing its rheumatoid arthritis (RA) drug,
Orencia. The unit, located in Devens, Massachusetts, is a
state-of-the-art bulk biologics manufacturing facility.
Approximately 300 people, in various capacities, are employed at
the manufacturing unit.
Management at Bristol-Myers stated that the increased
manufacturing capacity for Orencia, following the clearance of the
new site, will go a long way in meeting the increased demand for
the RA drug. We note that the FDA cleared the subcutaneous
formulation of Orencia last year. Only the intravenous version was
available prior to that. Management also believes that the
clearance is perfectly in tune with the pharma major's focus on
Prior to the approval of the Devens facility, the biologic
therapies at Bristol-Myers were manufactured in the company's
facility at Syracuse, New York and also through third party
suppliers. The products were packaged in Manati, Puerto Rico.
Bristol-Myers stated that the facility at Syracuse won't become
redundant following the approval of the new facility and would
remain a vital cog in Bristol-Myers' wheel.
Even though positive on the clearance of the new manufacturing
facility, we believe that investor focus will remain on the loss of
exclusivity of blockbuster blood thinner Plavix in the
U.S.-scheduled for May 17, 2012. Bristol-Myers has co-developed
). The loss of exclusivity is likely to result in substantial
revenue losses for Bristol-Myers.
Bristol-Myers is looking to combat the generic threat through
partnering deals and acquisitions. Apart from acquisitions and
partnership deals, Bristol-Myers is looking to introduce new
products to augment its product portfolio to combat the generic
threat. Bristol-Myers has met with a fair amount of success towards
achieving this objective. Many new products were launched/ approved
A key action date is coming up at Bristol-Myers later this year
when the FDA is scheduled to decide on blood thinner Eliquis,
), for preventing stroke in patients suffering from atrial
fibrillation. Positive news from the FDA will help boost the
We currently have a Neutral recommendation on Bristol-Myers. The
stock carries a Zacks #3 Rank (Hold rating) in the short run.
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