Bristol-Myers Squibb (NYSE:BMY) generates its revenue from sales of pharmaceuticals drugs for various therapeutic areas, including cardiovascular, virology, oncology, and immunology. In this note, we discuss the company’s business segments, their historical performance, and our forecasts for the coming years. You can look at our interactive dashboard analysis ~ How Does Bristol-Myers Squibb Make Money? ~ for more details. In addition, you can see more Healthcare Data here.
Bristol-Myers Squibb’s Business Model
- What Need Does It Serve?
- Brisol-Myers Squibb is a biopharmaceutical company that discovers, develops, and sells pharmaceutical products globally. Its drugs are used for the treatment of various types of diseases, including cancer, heart-related, and infectious, among others.
- Overall, the company’s pharmaceuticals portfolio can be divided into 5 segments, primarily on the basis of therapeutic areas: 1) Cardiovascular, 2) Oncology, 3) Virology, 4) Immunology, and 5) Mature Products & Others.
- Who Pays To Bristol-Myers Squibb?
- Chain stores (Walgreens, CVS, Rite-Aid, Walmart), clinics, long-term care facilities, health maintenance organizations, federal facilities, non-federal institutions, and mail order pharmacies.
- What Are The Alternatives To Bristol-Myers Squibb?
- Within pharmaceuticals, other alternatives are Johnson & Johnson, Roche, Pfizer, Merck, Abbvie, GlaxoSmithKline, and Teva, among others.
- Outside of pharmaceuticals, other alternatives are acupuncture, aromatherapy, ayurvedic medicine, chiropractic care, homeopathy, and nutritional counseling, among others.
Bristol-Myers Squibb’s Total Revenue Has Grown In Mid-Teens Since 2016, And It Could Grow In Mid-Single-Digits By 2020.
- Bristol-Myers Squibb’s total revenues grew from $19.4 billion in 2016 to $22.6 billion in 2018.
- This represents an average annual growth rate of 7.8%.
- We forecast the revenues to be a little under $24 billion by 2020, reflecting an average annual growth rate of 2.9%.
Revenue Growth Over The Next Two Years Will Likely Be Driven By Cardiovascular And Oncology Drugs, And It Could Partly Be Offset By A Decline In Virology Drugs And Mature Products Sales.
- Oncology revenue grew from $6.8 billion in 2016 to $10.3 billion in 2018, and it could grow to $11.3 billion in 2020. The growth in the recent years was driven by its blockbuster drug – Opdivo – given its positioning in lung cancer, which is a lucrative cancer drugs market. However, we forecast the growth rate to slow in the coming years, as Opdivo’s future growth largely depends on its further approvals for other indications, given the drug is facing stiff competition from Merck’s Keytruda, which has shown better results in recent studies.
- Cardiovascular revenue grew from $3.3 billion in 2016 to $6.4 billion in 2018, and it could grow to $8.2 billion by 2020, in our view. The only drug in this segment is Eliquis, which has added over $1 billion in new sales each year since its launch. This can be attributed to its increased acceptance among physicians, which has led to the drug becoming the market leader in NOACs total prescriptions. We expect the growth to continue, albeit at a slower pace.
- Immunology revenue grew from $2.3 billion in 2016 to $2.7 billion in 2018, but we expect this to decline to $2.3 billion by 2020, due to patent expiration of Orencia in 2019.
- Mature products & other revenue have been on a decline over the past few years. The figure declined from $2.3 billion in 2016 to $1.6 billion in 2018, and it could decline further to $1.2 billion in 2020.
- Virology drugs saw a massive decline from $4.7 billion in 2016 to $1.5 billion in 2018, and we estimate it to decline to under $1.0 billion in 2020. This can be attributed to patent expirations of Sustiva, Baraclude, and Reyataz over the last few years.
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