Bristol-Myers Squibb Co.’s second- quarter earnings beat analysts’ estimates as the drugmaker reduced costs and boosted sales of the blood thinner Plavix and treatments for HIV and hepatitis.
Income from continuing operations rose to $927 million, or 53 cents a share, from $880 million, or 44 cents, a year earlier, the New York-based company said today in a statement. Excluding some items, profit was 54 cents a share, a cent higher than the average estimate of 16 analysts tracked by Bloomberg.
Bristol-Myers is cutting more than $2.5 billion in expenses by 2012 and eliminated 7,000 jobs, 20 percent of its workforce, last year. The company is also narrowing its focus on biotechnology and making acquisitions to replace medicines facing generic competition during the next two years.
“The restructuring of the cost base, increased investment in high-growth opportunities, visible growth for Abilify and other newer drugs, combined with stable U.S. Plavix performance, can fuel a rising stock price,” said Barbara Ryan, an analyst with Deutsche Bank AG in Greenwich, Connecticut, in a July 12 research report.
Bristol-Myers rose 18 cents to $24.93 at 4 p.m. in New York Stock Exchange composite trading. The company has gained 23 percent in the past 12 months.
Sales rose 2.2 percent to $4.77 billion, missing analysts’ estimates by $65 million for the second quarter.
The company repeated its 2010 profit forecast of $2.10 to $2.20 a share excluding some items. Bristol also reaffirmed its 2013 earnings projection of at least $1.95 a share.
Investors had wondered if the company would reduce its 2013 figure because of U.S. health-care legislation and cuts to prices in Europe, said Seamus Fernandez, an analyst with Leerink Swann Co., in a report on July 16.
Revenue from Plavix, the world’s second-biggest selling medicine, after New York-based Pfizer Inc.’s Lipitor, rose 5.7 percent from a year earlier to $1.63 billion. Plavix is co- marketed with Paris-based Sanofi-Aventis SA.
In the HIV drug category, Sustiva revenue climbed 6.1 percent to $331 million, and Reyataz rose 7.9 percent to $357 million. Sales of the hepatitis B treatment Baraclude increased 25 percent to $223 million.
Continuing operations accounted for all of the company’s net income of $927 million in the current quarter. Net income from the second quarter of 2009, including an infant-nutrition business split off by the company last year, was $983 million.
Per-share figures this year were calculated on fewer shares; Bristol-Myers started repurchasing $3 billion in stock in May.
Health-care legislation passed in March reduced sales by 1.5 percent, Bristol-Myers said. The law expanded the number of hospitals serving low-income patients eligible for reduced prices on medicines, increased discounts to Medicaid and made subsidies for retirees’ prescriptions taxable.
Second-quarter sales of Abilify, a mood stabilizer, fell 1.6 percent from a year earlier, to $633 million. Bristol-Myers has said the U.S. health-law changes will hurt sales of that drug because Medicaid, the federal and state health program for low-income people, is cutting rebates.
“The likely consequences of the recently enacted health- care reform legislation are generally coming in in-line with expectations, with what we continue to regard as manageable long-term risks and costs for pharma,” Ryan said in the July 12 report.