Bristol-Myers Squibb Company Earnings Call Insights: Tax Rate Drop and PD-1 Readout
Tax Rate Drop
Gregg Gilbert – Merrill Lynch: Two I will ask them upfront. Charlie, can you talk a little bit more about the massive tax change at least massive relative to what I think market we are expecting going forward. And make sure while in the right place in terms of the ongoing sustainable rate and perhaps a commercial question on ELIQUIS, J&J talked about strong Q2 access for Zorelto and even though you have the best profile your and Pfizer’s plan the pay up to ensure that access is similar to the competition or do you have another strategy in that regard?
Charles Bancroft – EVP and CFO: It’s Charlie. As I mentioned in my comments there are three main reasons for the drop in our overall tax rate. Let me go through each one and take you through, which ones are sustainable as we think about our rate going forward. So regard to the R&D tax credit, which we have a double dip in 2013, as we have the 2012 benefit as well. Obviously, the piece that relates to 2012 is not sustainable going forward. As we talked about PLAVIX, PLAVIX is now out of our business, so that benefit we also see going forward, but remember earnings mix will always play a role as we think about our tax rate. And then lastly, the restructuring we did that had a positive impact on our earnings mix. We expect that this impact will be sustainable going forward.
Lamberto Andreotti – CEO: As to your question on ELIQUIS, well, Giovanni will address specific question. Let me repeat a couple of things about ELIQUIS and add a few things. First of all, as I said before, the approval of ELIQUIS last year was a significant accomplishment for us. We had the approvals in all those geographies, U.S., Europe, Japan, Canada, South Korea all in just over one month’s time. This is an achievement per se. And as I said before, we continue to believe that based on the data from our clinical trials, ELIQUIS has a real differentiated profile and we were very encouraged to see that the approvals in different parts of the world reflects the risk reduction versus warfarin in all three important outcomes of stroke reduction, major bleeding (indiscernible). So good clinical data and labels reflecting that clinical data. This unique and differentiated profile of ELIQUIS will resonate, we believe so, and will position us well against warfarin and against all other anticoagulants including the one you mentioned. We are working to secure pricing and access, and as I said, launch is happening in this very weeks, in these very days. So one last point, the quality of the product as I said, there is strength of the label as I said, there is a strength of the label as I’ve said, but there is also the fact that we both Bristol-Myers Squibb and Pfizer have a strong experience and we are leader in the cardiovascular, this is all of this make me very confident that we will be very successful. Giovanni you don’t you continue from here.
Giovanni Caforio, M.D. – President, U.S. Pharmaceuticals: Just following up on what Lamberto said we are getting ready for launch in early February, but in fact access is our number one priority. So our access teams are actually already working there in the field. We scheduled many meetings with all of the key plans both commercial and Medicare and some of those meetings have taken place already. To echo what Lamberto said we believe that the strong profile and the quality of the label will be extremely important to access and we don’t expect significant barriers. We also have put in place specifically for commercial patients a very good set of programs in place to manage the out-of-pocket cost for patients. And that will be important in the commercial space at the beginning as we improve our access situation and then we will go, of course, continue to be important going forward but we are very focused on this and the profile and the label will be very important.
Jami Rubin – Goldman Sachs: And John I don’t know if Elliott is on the call, but I wanted to ask sort of a big picture question on PD-1 obviously this is going to be an important year for further disclosure of PD-1 readout. I’m wondering if you could just update us on where you are with your Phase 3 program, what other additional trials do you have planned. How you see the competitive dynamics playing out, you are not alone in this field, there are other companies also pursuing PD-1 and PD-L1. And specifically what can we expect to see at ASCO this year?
Elliott Sigal, M.D., Ph.D. – EVP, CSO and President, R&D: This is Elliott. Yes, we continue to advance our leadership position in immune-oncology and PD-1 as you stay clearly as an important part of our platform. We were quite encouraged last year by the data that we presented at the clinical oncology meeting and that appeared in the New England Journal of Medicine showing that mono-therapy with this agent is clinically active than non-small cell lung cancer metastatic melanoma and renal cell carcinoma with durable responses in most patients in an acceptable and manageable safety profile. We’ve had experience now in multiple dose levels and we believe the activity is encouraging, because it is significant in heavily pretreated patients. We show some updated results at the end of the year. So, we basically have moved on this data from a Phase I, Phase II compound into five significant Phase III studies that are all ongoing now. There are two lung studies in second line squamous and second non-squamous, our strategy to stratify based on that histology as based on data that we’ve seen. We are also doing extensive analysis looking for biomarkers, which could be a distinguishing aspect to the program. We have a renal cell carcinoma study in Phase III. We now have two melanoma studies in the Phase III. One in advance patients post ipilimumab and one in non-treated patients versus chemotherapy. Also we have a Phase I combination study with YERVOY and I think one of the exciting aspects of our program is getting early experience with combinations particularly with different mechanisms to boost the immune system that will be I think a very interesting data that will be able to present hopefully at ASCO this year and ASCO we’ll be giving updates of the Phase I, Phase II in terms of survival data, in terms of biomarkers, and all these five Phase III studies will be ongoing. And we clearly acknowledge that there’s competition in this field. We are gratified to be in the position we are in. we’re not going to be complacent. We think it’s important to move fast in this area with high-quality molecules that are well characterized with biomarker studies, and I would say with combinations that we’re in a very good position to administer and to explore. We do have a PD-L1 mechanism and that’s respectable competition from Genentech in Phase I in their program, I believe. Our view is there may be a theoretical advantage to targeting anti-PD1 because you can cover both the PD-L1 and the PD-L2 ligands. We’ll have to see whether that matters. Essentially we had enough information and extensive information on PD-1 to move as we have.
A Closer Look: Bristol-Myers Squibb Earnings Cheat Sheet>>