Published
# Bristol-Myers Squibb Company (BMY) — Business, Risks and Management's Discussion Bristol-Myers Squibb Company, CIK 0000014272. Sources: Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (SEC accession 0000014272-26-000004, filed February 11, 2026); Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2026 (SEC accession 0000014272-26-000020, filed July 30, 2026); and the second-quarter 2026 earnings release furnished as Exhibit 99.1 to the Current Report on Form 8-K dated July 30, 2026 (SEC accession 0000014272-26-000018). --- ## Business *From the FY2025 Form 10-K, accession 0000014272-26-000004.* Bristol Myers Squibb is a global biopharmaceutical company that discovers, develops, licenses, manufactures, markets, distributes and sells prescription medicines for serious diseases. It operates as a **single reportable segment**, and it concentrates its portfolio in six areas: oncology, hematology, immunology, cardiovascular, neuroscience, and other areas where it believes it can create long-term value. Products are sold worldwide, principally to wholesalers, distributors and specialty pharmacies, and to a lesser extent to retailers, hospitals, clinics, government agencies and directly to patients. Total revenues were **$48,194 million in 2025**, essentially flat against $48,300 million in 2024, split **69% United States, 29% international and 2% other** (royalties and alliance-related revenues for products not sold by BMS's regional commercial organizations). As of December 31, 2025 the company had approximately **32,500 employees in 43 countries**, roughly 54% of them in the U.S. (excluding Puerto Rico). The company's stated priorities are to focus on transformational medicines where it believes it has a competitive advantage, to drive operational excellence, and to allocate capital for long-term growth and shareholder returns. Its strategy is described as combining the resources and scale of a large pharmaceutical company with the speed and focus on innovation of the biotech industry. Bristol-Myers Squibb Company was incorporated in Delaware in August 1933 as Bristol-Myers Company, successor to a New York business started in 1887, and took its present name in 1989 following a merger. Its current shape owes more to recent transactions — Celgene (2019) and Mirati, Karuna and RayzeBio (2024) — whose products, pipeline and financing consequences run through the sections below. ### Growth Portfolio and Legacy Portfolio Management divides the product base into two groups, and the split is the central fact about the business today. In 2025 the **Growth Portfolio generated $26,409 million, up 17%**, while the **Legacy Portfolio generated $21,785 million, down 15%** as generic and biosimilar entry eroded older brands. **Growth Portfolio** — the medicines earlier in their lifecycles: - **Opdivo** (nivolumab), a fully human monoclonal antibody binding PD-1 on T and NKT cells, approved across bladder, blood, colorectal, head and neck, renal cell, hepatocellular, lung, melanoma, mesothelioma, stomach and esophageal cancers. The **Opdivo + Yervoy** regimen is approved in multiple markets across non-small cell lung cancer, melanoma, mesothelioma, renal cell, colorectal, hepatocellular and gastric/esophageal cancers. - **Opdivo Qvantig** (nivolumab and hyaluronidase-nvhy), a subcutaneous PD-1 inhibitor covering most previously approved adult solid-tumor Opdivo indications; marketed as Opdivo SC in the EU. - **Orencia** (abatacept), a fusion protein for rheumatoid arthritis, polyarticular juvenile idiopathic arthritis, psoriatic arthritis and prophylaxis of acute graft-versus-host disease. - **Yervoy** (ipilimumab), a CTLA-4 checkpoint inhibitor for unresectable or metastatic melanoma and, in combination, several other tumors. - **Reblozyl** (luspatercept-aamt), an erythroid maturation agent for anemia in beta thalassemia and lower-risk myelodysplastic syndromes. Licensed from Merck, with tiered royalties of 20% to 24% of net sales payable to Merck. - **Breyanzi** (lisocabtagene maraleucel), a CD19-directed autologous CAR-T therapy for relapsed or refractory large B-cell lymphoma, follicular lymphoma, CLL/SLL, mantle cell lymphoma and marginal zone lymphoma. - **Opdualag** (nivolumab and relatlimab-rmbw), a PD-1/LAG-3 combination for unresectable or metastatic melanoma in patients 12 and older. - **Camzyos** (mavacamten), an oral cardiac myosin inhibitor for symptomatic obstructive hypertrophic cardiomyopathy, distributed only through the Camzyos REMS program. - **Zeposia** (ozanimod), an oral immunomodulator for relapsing multiple sclerosis and moderately to severely active ulcerative colitis. - **Abecma** (idecabtagene vicleucel), a BCMA-directed autologous CAR-T therapy for relapsed or refractory multiple myeloma after two or more prior lines. - **Sotyktu** (deucravacitinib), an oral allosteric TYK2 inhibitor for moderate-to-severe plaque psoriasis. - **Krazati** (adagrasib), an oral KRAS-G12C inhibitor for previously treated NSCLC and, with cetuximab, for previously treated colorectal cancer. Acquired with Mirati. - **Cobenfy** (xanomeline and trospium chloride), an oral M1/M4 muscarinic agonist combination for schizophrenia in adults, FDA-approved September 2024 and launched in the U.S. in October 2024 and Puerto Rico in January 2025. Acquired with Karuna. - Other growth products include Augtyro, Onureg, Inrebic, Nulojix and Empliciti, plus royalty revenue including royalties from Merck on **Winrevair** at 22% of net sales. **Legacy Portfolio** — **Eliquis** (apixaban), an oral Factor Xa inhibitor for stroke/systemic embolism risk reduction in non-valvular atrial fibrillation and for DVT/PE, partnered with Pfizer; **Revlimid** (lenalidomide); **Pomalyst/Imnovid** (pomalidomide); **Sprycel** (dasatinib); **Abraxane** (paclitaxel albumin-bound); and other mature brands. Eliquis remains the single largest product in the company at **$14,443 million in 2025 (up 8%)**, and it is the one Legacy brand still growing. ### Intellectual property and exclusivity In the pharmaceutical industry most of an innovative product's commercial value is realized during its market exclusivity period, set by patent rights and by regulatory exclusivity (five years for innovative chemical products in the U.S., twelve years for qualified innovative biologics, and an "8+2+1" regime in the EU). When exclusivity ends and generics or biosimilars launch, declines in the original product's sales are usually substantial and rapid, and faster in the U.S. than in most other developed markets. The 10-K publishes estimated minimum market exclusivity dates, stated to be for business planning only. Selected entries (U.S. / EU / Japan): Eliquis **2028 / see footnote / 2026**; Opdivo **2028 / 2030 / 2031**; Breyanzi 2033 / 2033 / 2033; Sotyktu 2033 / 2033 / 2037; Zeposia 2033 / 2034 / 2034; Opdualag 2034 / 2033 / not marketed; Camzyos 2036 / 2034 / 2034; Abecma 2036 / 2035 / 2037; Krazati 2037 / 2038 / not marketed. Reblozyl is 2031 / 2030 / 2034 on regulatory exclusivity, with later patent expiries where term restorations were granted. Abraxane, Revlimid and Sprycel have already lost exclusivity in the U.S., EU and Japan; Orencia and Cobenfy carry product-specific footnotes rather than dates; for Opdivo Qvantig the footnote gives estimated minimum exclusivity of **2028 (U.S.) and 2030 (EU)** based on the expiry of the nivolumab composition-of-matter patent. Two situations dominate. For **Eliquis**, multiple U.S. generic filers challenged Orange Book patents; BMS and Pfizer settled with some and prevailed at trial and on appeal against others, with settling companies permitted to launch in **2028** subject to further challenge. In the EU the apixaban composition-of-matter patents and related SPCs **expire in November 2026**, and generics have already begun marketing in certain EU countries while litigation is pending. For **Revlimid**, certain generic companies market lenalidomide under litigation-settlement licenses that, **as of January 31, 2026, are no longer volume-limited**; generics have entered in the EU and Japan. **Pomalyst** U.S. generic entry was expected in the first quarter of 2026. ### Manufacturing, supply and distribution Significant biologics, cell therapy and pharmaceutical manufacturing sites are in the **U.S., Puerto Rico, the Netherlands, Ireland and Switzerland**. Cell therapy manufacturing runs through Bothell, Washington; Summit, New Jersey; Devens, Massachusetts (FDA-approved for CAR-T in June 2023); and Leiden, the Netherlands, where construction of a new facility was completed in 2025. A new **radiopharmaceutical facility in Indianapolis, Indiana** opened in 2025 to support therapies acquired with RayzeBio. The company relies on third parties for all or part of the active ingredient or drug substance for Eliquis, Opdivo, Pomalyst/Imnovid, Yervoy, Sprycel, Abraxane, Zeposia, Camzyos, Sotyktu and Krazati, and is expanding third-party use for drug product and finished goods, particularly for mature brands. Some raw materials come from sole or single approved sources. Longer term it is moving to new vector technologies on a dual-sourcing strategy. Products go principally to wholesalers, distributors and specialty pharmacies. U.S. distribution service agreements with substantially all direct wholesaler and distributor customers let the company monitor inventory and require levels no greater than one month of demand; those agreements, including with the three largest wholesalers, **expire in June 2027** subject to termination provisions. Revlimid, Pomalyst and Camzyos are distributed through mandatory risk-management (REMS) programs. In 2026 the company also announced direct-to-patient offerings for several products. ### Competition, pricing and market access Competition comes from other global research-based drug companies, smaller focused research companies and generic manufacturers, on efficacy, safety, ease of use, price and demonstrated cost-effectiveness. Immuno-oncology is singled out: Opdivo operates in a highly competitive market, facing both existing IO products gaining new indications and new IO agents, plus combination regimens. Generic manufacturers, exempt from repeating clinical studies, invest far less in R&D and price well below branded products, so loss of exclusivity normally means losing the major portion of a product's revenue in a very short period. On price, the company operates under intensifying government intervention. In the U.S. it must provide discounts under various federal and state healthcare programs and comply with state price-transparency laws. Outside the U.S. it faces government-mandated cost containment: direct price control at launch in most EU countries, reference pricing, repeated reevaluation through a medicine's life, volume discounts, cost caps and clawbacks — including a UK scheme capping total annual growth in NHS spending on branded medicines, with excess returned as rebate, and Japanese price cuts outside the normal repricing cycle. Consolidation of managed care organizations and pharmacy benefit managers in the U.S. has increased their purchasing strength, and formulary exclusion can sharply reduce a product's usage. ### Business development Significant 2025 activity: the **acquisition of Orbital Therapeutics**, completed in December 2025 (full rights to OTX-201, a preclinical in vivo CAR-T therapy in IND-enabling studies for autoimmune disease), an all-cash transaction for total consideration of **$1.7 billion**, or $1.5 billion net of cash acquired, accounted for as an asset acquisition; a **global strategic collaboration with BioNTech** to co-develop and co-commercialize pumitamig (BNT327/BMS-986545), a PD-L1 x VEGF-A bispecific, with equal sharing of global profits and losses subject to exceptions; and a **global exclusive license from Philochem** for OncoACP3, a radiopharmaceutical therapeutic and diagnostic targeting prostate cancer. The company also completed the acquisition of **2seventy bio** on May 13, 2025 at $5.00 per share in cash, total consideration $287 million ($114 million net of cash acquired), giving it full U.S. rights to Abecma; it was accounted for as an asset acquisition. --- ## Risk factors *From the FY2025 Form 10-K, accession 0000014272-26-000004, condensed.* **Pricing pressure and government price-setting.** Market access constraints, required rebates and discounts in the U.S., EU and elsewhere continue to lower prices, reimbursement rates and reimbursed populations, and management expects them to become more acute. Under the Inflation Reduction Act, HHS can effectively set prices for certain single-source drugs and biologics, generally nine years after approval for small molecules and thirteen for biologics, capped at a statutory ceiling likely to represent a significant discount to average prices. HHS has announced a "maximum fair price" for a 30-day equivalent supply of **Eliquis effective January 1, 2026**, and for a 30-day supply of **Pomalyst effective January 1, 2027**, and in January 2026 selected **Orencia** for negotiation with government-set prices beginning in **2028**. More products could be selected, and previously selected prices renegotiated, which could accelerate revenue erosion ahead of the expiry of intellectual property protection. The IRA also requires rebates where a Part B or Part D price rises faster than inflation, and its Part D redesign replaced the 70% coverage-gap discount with a 10%/20% manufacturer discount structure around a $2,000 out-of-pocket threshold. Non-compliance carries excise tax and civil monetary penalties. **The U.S. Government Agreement.** Announced in December 2025, it commits the company to provide Eliquis free to the Medicaid program effective January 1, 2026; donate more than seven tons of Eliquis API to the U.S. Strategic Active Ingredient Reserve; enable direct-to-patient access to Sotyktu, Zeposia, Reyataz, Baraclude and Orencia for cash-paying patients at discounts of approximately 80% off current list prices; adopt a more balanced pricing approach for new launches across developed nations; and continue expanding domestic production. In exchange BMS receives certain U.S. tariff relief until **January 2029** and is not subject to future U.S. pricing mandates while the agreement remains in effect — exemptions that may be terminated or not extended. Pricing mandates outside the U.S. still apply. **Other policy exposure.** The One Big Beautiful Bill Act, enacted July 2025, aims at efficiencies in federal healthcare spending primarily within Medicaid, and its full commercial implications are still being assessed. The company participates in the **340B program**, whose expanded utilization has already hurt revenues and margins; it recognizes up to four contract pharmacy locations per 340B hospital lacking an entity-owned pharmacy (raised from two effective July 1, 2024), and multiple states have enacted laws prohibiting such restrictions. Many states are separately pursuing drug pricing and reimbursement action, including prescription drug affordability boards. **Pipeline execution.** Sales of branded products such as Orencia, Eliquis and Opdivo are expected to decline after loss of exclusivity, so future success depends heavily on the pipeline, where the rate of failure is inherently high. Named risks include efficacy and safety findings, delayed or denied approvals, difficulty enrolling trials, commercial-scale manufacturing problems, intellectual property disputes, inadequate reimbursement, and changing clinical preferences. Products approved under Accelerated Approval are contingent on confirmatory studies. Clinical data announcements — the company's or competitors' — can cause significant stock volatility, and cancelled or downgraded acquired pipeline programs can produce material non-cash impairment charges. **Earlier-than-expected loss of exclusivity.** Patent scope varies by country, some EU member states offered no basic patent protection historically, and validity and enforceability cannot be predicted. Generic and biosimilar makers increasingly challenge patents before expiry and may launch "at risk". The filing cites Eliquis generics already marketed in the UK and Finland following adverse decisions, and Revlimid generic entry from January 2022 in Europe and under U.S. licenses now free of volume limits. In October 2025 the FDA issued draft guidance to streamline biosimilar development, including minimizing comparative clinical efficacy studies. **Concentration in a few products.** A majority of revenue and earnings comes from several key products; **Eliquis, Opdivo, Opdivo Qvantig, Orencia, Reblozyl and Yervoy** are expected to represent a significant percentage of revenue, earnings and cash flows over the next few years. Most U.S. products move through wholesalers, and consolidation among pharmacy chains, wholesalers and PBMs is expected to increase pricing pressure. **Third-party royalty income.** Royalties have been a significant percentage of pretax income — approximately **$2.7 billion in 2025** — and are declining: royalties on **Keytruda** and **Tecentriq** are expected to terminate on **December 31, 2026**, and royalties from the divestiture of the diabetes business **terminated on December 31, 2025**. **Supply chain, manufacturing and tariffs.** Exposures include recalls and plant closures, cGMP non-compliance, sole- and single-source suppliers, third-party manufacturer failures, construction and regulatory approval delays, and disruption from natural disasters, pandemics, war or terrorism. Pharmaceuticals were largely exempt from tariffs imposed in 2025, but exemptions may end or not apply to future tariffs. Manufacturing processes for CAR-T cell therapies and radiopharmaceuticals are still evolving; radiopharmaceuticals have time-limited stability once manufactured, cell therapy requires a complex chain of identity and custody, and slight deviations can cause loss of product or regulatory action. **Labeling and safety.** Post-approval data can force label changes that reduce market acceptance. In January 2024 the FDA determined that approved CAR-T therapies required safety labeling changes including a **boxed warning** about possible risk of T-cell malignancies. Safety or efficacy concerns about a third party's product in the same class can implicate the whole class. **Legal, regulatory and tax.** Patent litigation, product liability, consumer protection, anti-corruption, securities, antitrust, federal and state pricing, data privacy and environmental matters are all cited. Tax risk includes ongoing examinations, transfer pricing challenges, and Pillar Two legislation enacted in various jurisdictions. **Leverage and financing.** Acquisitions including Mirati, Karuna and RayzeBio increased debt and interest expense; following the December 2023 acquisition announcements, Standard & Poor's downgraded the long-term credit rating from **A+ to A** with a stable outlook. Although debt has since been reduced, future business development may require additional equity or debt financing and could increase leverage or trigger a downgrade. **Macroeconomic and geopolitical.** Approximately **31% of 2025 revenues were generated outside the U.S.**, exposing results to a strengthening dollar, global inflation, and customer credit risk in Europe, South America and government-guaranteed hospital receivables. Clinical development delays could lead to material impairment of intangible assets, including the **$19.1 billion of other intangible assets as of December 31, 2025**. **Technology and people.** The company depends extensively on information technology and faces cyber attack, ransomware and data-theft risk, including through third-party vendors; it is also adopting AI, where flawed algorithms or biased data may produce deficient output, the regulatory landscape is uncertain, and competitors may adopt more effective technologies. It competes for a limited pool of qualified scientific, technical and management talent, and periodic adjustments to personnel needs may affect culture and retention. **Shareholder returns and governance.** Dividends are at the Board's discretion and any reduction or elimination could hurt the stock price; the company may also cease or reduce repurchases at any time. Amended bylaws designate the Delaware Court of Chancery as the exclusive forum for specified stockholder claims, which may discourage such suits. **ESG reporting.** Increased regulatory, investor and stakeholder focus on environmental and social policy, and the company's own publicly announced aspirational goals, expose it to compliance costs, potential liability and reputational risk if goals are not met or stakeholders disagree with them. --- ## Management's discussion and analysis — fiscal year 2025 *From the FY2025 Form 10-K, accession 0000014272-26-000004.* ### Revenue **Total revenues were $48,194 million, down from $48,300 million** — essentially flat, with a 1% favourable foreign exchange contribution. Demand rose across the Growth Portfolio and for Eliquis and was offset by generic erosion across the rest of the Legacy Portfolio; revenues were additionally reduced by higher U.S. government channel rebates. Management stated it expects continued Legacy Portfolio generic erosion in 2026, primarily from Revlimid and Pomalyst in the U.S. By region: **United States $33,279 million, down 2%**, with average net selling prices down 4%; **International $13,828 million, up 5%** (up 3% excluding foreign exchange); **Other revenues $1,087 million, up 9%**. No single country outside the U.S. contributed more than 10% of total revenues. The business is described as not typically seasonal, apart from a first-quarter unwinding of fourth-quarter sales channel inventory build. By portfolio: **Growth $26,409 million, up 17%; Legacy $21,785 million, down 15%.** Within Legacy, Eliquis was $14,443 million (up 8%), Revlimid $2,951 million (down 49%) and Pomalyst/Imnovid $2,733 million (down 23%). Opdivo was $10,049 million (up 8%). ### Expenses **Total expenses were $38,866 million, down 31% from $56,679 million.** Cost of products sold (excluding amortization of acquired intangibles) was **$13,936 million**, effectively flat, as $1.3 billion lower intangible asset impairment charges were offset by higher alliance profit sharing and product mix. **Selling, general and administrative expense fell $1.1 billion, or 14%, to $7,267 million**, on cost savings from the strategic productivity initiative and lower acquisition-related cash settlements of unvested stock awards, partly offset by investment in new launches. **Research and development fell $1.2 billion, or 11%, to $9,951 million**, on lower in-process R&D impairment charges and the same cost savings. **Acquired in-process R&D fell 72% to $3,721 million** from $13,373 million, the prior year having carried the $12,122 million Karuna asset acquisition charge. The 2025 charges were BioNTech upfront $1,500 million, Orbital asset acquisition $1,379 million, Philochem upfront $350 million, SystImmune upfront and milestone $250 million, BioArctic upfront $100 million, Evotec designation and opt-in license fees $113 million, and other $29 million. **Amortization of acquired intangible assets fell $5.6 billion, or 63%, to $3,317 million**, chiefly because the Revlimid acquired marketed product right was fully amortized in the fourth quarter of 2024; the Pomalyst right was fully amortized in the fourth quarter of 2025. **Other (income)/expense, net was a $674 million expense**, improved by $219 million. Within it: interest expense $1,891 million; royalty income from divestitures $(1,129) million; royalty and licensing income $(1,093) million, including $85 million recognized on the out-license of five early-stage immunology assets to a company newly formed with Bain Capital Life Sciences and $170 million on amending a pre-existing out-licensing arrangement that effectively terminates future international royalties; investment income $(586) million, higher on larger cash balances; provision for restructuring $563 million; litigation and other settlements $434 million; a **$356 million loss on debt redemption** from the early redemption of $8.7 billion of long-term debt; contingent consideration $351 million from the change in fair value of the Mirati contingent value rights; and equity investment gains of $(280) million. ### Taxes and earnings Earnings before income taxes were **$9,328 million**, against a **$(8,379) million** loss in 2024. The income tax provision was $2,272 million for an **effective tax rate of 24.4%**, or **18.8% excluding specified items**. The rate was driven primarily by a $1.4 billion one-time, non-deductible charge for the Orbital Therapeutics acquisition and jurisdictional earnings mix, and includes release of approximately $300 million of income tax reserves on the lapse of the statute for U.S. federal years 2019–2020, offset by $160 million of added transfer pricing reserves and other matters. The OBBBA, enacted July 2025, permits immediate deduction of up to 100% of qualifying domestic R&D expense for tax years beginning after December 31, 2024 and acceleration of domestic R&D deductions deferred from 2022 to 2024; its effects are reflected in the 2025 provision and balances. **Net earnings attributable to BMS were $7,054 million**, against a $(8,948) million loss. **GAAP diluted EPS was $3.46**, a $7.87 swing from $(4.41), attributed principally to lower Acquired IPRD charges, lower amortization and lower intangible impairments, and productivity cost savings. **Non-GAAP diluted EPS was $6.15** against $1.15, on non-GAAP net earnings of $12,545 million; specified items added $5,491 million to net earnings and $2.69 to EPS. ### Financial position, liquidity and cash flows Cash, cash equivalents and marketable debt securities totalled **$11,069 million** at December 31, 2025 ($10,209 million of it cash and equivalents). Short-term debt obligations were $2,261 million and long-term debt $42,850 million, for a **net debt position of $(34,043) million**, an improvement of $4.4 billion over the year — driven by $14.2 billion of operating cash flow, partly offset by $5.0 billion of dividends and $3.9 billion of payments for acquisitions, collaborations and milestones. Management states existing resources plus operating cash flow and borrowing access are sufficient for at least the next few years, including debt maturities of approximately $8.9 billion through 2030. Financing activity in the year was substantial. In November 2025 a wholly owned subsidiary completed a registered public offering of **€5.0 billion of euro-denominated senior unsecured notes**, with net proceeds of $5.7 billion, fully and unconditionally guaranteed by Bristol-Myers Squibb. In November and December 2025 the company **repurchased $8.7 billion aggregate principal of debt for $9.1 billion of cash** through tender offers and make-whole redemptions, recognizing the $356 million loss noted above. Repayment of notes at maturity was approximately $1.9 billion in 2025 and $2.9 billion in 2024. Dividends were **$5.0 billion in 2025** at **$0.62 per share per quarter**. There were **no share repurchases in 2025**, with $5.0 billion of capacity remaining under the program at year end. Capital expenditures were approximately **$1.3 billion in 2025** and are expected to be approximately $1.3 billion in 2026, with investments planned over the next three years to improve and enable additional U.S. domestic manufacturing. Cash flow: **operating $14,156 million**, down $1.0 billion on higher gross-to-net payments, partly offset by lower expenses from the productivity initiative and lower acquisition-related expense; **investing $(4,132) million** against $(21,352) million, a $17.2 billion change because 2024 carried $17.9 billion of acquisition payments; **financing $(10,348) million** against $5,127 million provided in 2024, a $15.5 billion change reflecting the 2024 debt issuance to fund RayzeBio and Karuna and the 2025 debt repurchases. The company is committed to an aggregate **$18.3 billion of potential contingent R&D milestone payments** ($9.6 billion early-stage, $8.7 billion late-stage) plus **$21.5 billion of sales-based milestones**, in addition to royalties. Credit ratings were Moody's A2 / Prime-1 and S&P A / A-1, both with stable long-term outlook. ### Restructuring The 2023 Restructuring Plan streamlines the operating model across R&D, manufacturing, commercial and other functions. Following a 2025 expansion, the company expects approximately **$2.0 billion of cost savings by the end of 2027**, with exit costs included in the plan. --- ## Current quarter — second quarter and first half of 2026 *From the Form 10-Q for the period ended June 30, 2026, accession 0000014272-26-000020, and the earnings release furnished as Exhibit 99.1 to the Form 8-K dated July 30, 2026, accession 0000014272-26-000018.* ### Results **Total revenues were $12,973 million in the second quarter, up 6% (up 5% excluding foreign exchange)**, and **$24,462 million for the six months, up 4%**. The **Growth Portfolio rose 15% to $7,560 million** in the quarter and the **Legacy Portfolio fell 4% to $5,422 million**. By region, U.S. revenues were $8,991 million (up 6%), international $3,664 million (up 5%, or 4% excluding foreign exchange), and other $318 million (up 18%). Year to date, U.S. revenues rose only 2% while international rose 8%. Average U.S. net selling prices increased 4% year to date. Growth Portfolio drivers in the quarter: **Opdivo Qvantig $261 million** (from $30 million, on its 2025 launch); **Camzyos $416 million, up 60%**; **Reblozyl $735 million, up 29%**; **Breyanzi $484 million, up 41%**; **Opdualag $349 million, up 23%**; **Orencia $1,034 million, up 7%**; **Yervoy $769 million, up 6%**; **Cobenfy $63 million, up 81%**; Sotyktu $87 million, up 23%; Zeposia $169 million, up 12%; Krazati $55 million, up 14%. **Opdivo fell 3% to $2,485 million**, primarily on lower U.S. demand reflecting greater utilization of Opdivo Qvantig, partly offset by 1% of favourable foreign exchange; excluding foreign exchange it fell 4% in the quarter and 6% year to date. Legacy Portfolio: **Eliquis rose 22% to $4,481 million** (U.S. up 27%), on higher demand, 1% of favourable foreign exchange, and higher average net selling prices in the U.S. — the company **reduced the U.S. list price for Eliquis in 2026**, which raised realized average net selling prices because rebates fell. **Revlimid fell 49% to $425 million** and **Pomalyst/Imnovid fell 71% to $204 million** on U.S. generic erosion (U.S. Pomalyst generics entered in March 2026); Sprycel fell 27% and Abraxane 47%. The Eliquis list price reduction reshaped the gross-to-net line. **Gross product sales fell 18% to $18,179 million** while **total gross-to-net adjustments fell 46% to $(5,592) million**, leaving net product sales up 6% at $12,588 million. The **gross-to-net adjustment percentage fell to 30% from 46%**, and the U.S. percentage to **34% from 52%**. Prior-period estimate changes reduced provisions by $88 million in the quarter and $67 million year to date. ### Expenses, margin and earnings **Total expenses fell 15% to $8,887 million.** Cost of products sold rose 11% to $3,726 million on higher alliance profit sharing, taking **GAAP gross margin to 71.3% from 72.5%** (non-GAAP 71.4% from 72.6%) on a change in product mix. **SG&A rose 7% to $1,826 million** on investment in new product launches, partly offset by productivity savings. **R&D rose 15% to $2,959 million**, driven by higher in-process R&D impairment charges and the purchase of a priority review voucher: IPRD impairment charges of **$420 million in the quarter and $830 million year to date** (primarily a partial write-down of an oncology asset on recent clinical results and development plan changes, plus a radiopharmaceutical asset write-down year to date on an indication realignment), and a **$220 million priority review voucher** expensed in the quarter. **Acquired IPRD was nil** against $1,508 million a year earlier, which had included the $1,500 million BioNTech upfront fee. **Amortization of acquired intangible assets fell 47% to $437 million**, mainly on Pomalyst becoming fully amortized. **Other (income)/expense, net was $(61) million of income** against $494 million of expense, a $555 million swing. Interest expense fell to $407 million from $485 million. Royalty income from divestitures was nil against $(286) million, reflecting the expiry of diabetes royalties at the end of 2025. Equity investment gains were $(114) million against $22 million of losses. Divestiture gains were $(138) million, including a **$109 million gain on the sale of BMS's 60% ownership stake in Sino-American Shanghai Squibb Pharmaceuticals Limited**, which brought in $164 million of net cash proceeds. Restructuring provisions were $56 million against $223 million, and total restructuring charges were a net credit of $(32) million for the quarter on $(106) million of other shutdown income. Earnings before income taxes were **$4,086 million** against $1,773 million. The effective tax rate fell to **18.8% from 25.9%** on jurisdictional earnings mix including amortization of acquired intangibles, partly offset by the 2025 tax effect of the BioNTech collaboration; the rate excluding specified items was 16.5% against 16.1%. **Net earnings attributable to BMS were $3,317 million**, or **GAAP diluted EPS of $1.62** against $0.64. **Non-GAAP diluted EPS was $2.04** against $1.46, on non-GAAP net earnings of $4,172 million; specified items added $908 million to pretax earnings and $0.42 to EPS. For the six months, GAAP EPS was $2.93 and non-GAAP EPS $3.62. ### Balance sheet and cash flows Cash and equivalents were **$8,722 million** at June 30, 2026 with marketable debt securities of $2,742 million, for total cash and securities of **$11,464 million**. Short-term debt obligations were $1,027 million and long-term debt $42,093 million, for a **net debt position of $(31,656) million** — a **$2.4 billion improvement** over the six months, driven by $4.5 billion of operating cash flow less $2.6 billion of dividends. Long-term debt principal value fell to $42,421 million from $44,323 million; the fair value of long-term debt was $39.2 billion. **$1.7 billion of debt matured and was repaid** in the half, including the $1.2 billion 3.20% notes and $500 million of floating rate notes. The $5.0 billion revolving credit facility was extended in January 2026 from January 2030 to January 2031 and was undrawn; the commercial paper program limit remains $5.0 billion. Six-month cash flows: **operating $4,497 million**, down $1.4 billion, driven by lower net customer receipts primarily from the Eliquis U.S. list price reduction, partly offset by lower expenses from the productivity initiative; **investing $(1,745) million**, mainly $1.9 billion of net purchases of marketable debt securities; **financing $(4,190) million**, mainly $2.6 billion of dividends and $1.7 billion of debt repayment. Goodwill was $21,740 million and **other intangible assets net fell to $17,387 million from $19,103 million** at year end, with in-process R&D down to $6,770 million from $7,600 million. Total inventories per Note 12 were $4,369 million, of which $2,737 million sits in the current-asset Inventories line and $1,632 million in other non-current assets. Receivables were $10,553 million, with the three largest U.S. customers representing 71% of total trade receivables (75% at year end). Environmental remediation exposure was estimated at $66 million. Cash dividends of **$0.63 per share were declared in each of the first two quarters of 2026**, up from $0.62 per quarter in 2025, totalling $2,574 million declared. **No shares were repurchased under the publicly announced share repurchase program during the second quarter**, and $5.0 billion of capacity remained. The 2023 Restructuring Plan is now expected to total approximately **$2.5 billion of charges through 2027, with $1.8 billion incurred to date**; remaining charges under other acquisition plans are approximately $45 million. The productivity initiative is still expected to deliver approximately $2.0 billion of annual cost savings by the end of 2027. ### Guidance With second-quarter results the company **raised its full-year 2026 outlook**. Non-GAAP revenue guidance increased from approximately **$46.0–$47.5 billion to approximately $49.0–$50.0 billion**, attributed primarily to broad-based and continuing momentum across the portfolio. **Non-GAAP diluted EPS guidance increased from $6.05–$6.35 to $6.75–$7.00.** Full-year operating expenses (SG&A plus R&D) are now expected to be approximately **$16.5 billion**, up from $16.3 billion, on increased investment behind key pipeline programs and new product launches. Gross margin guidance of approximately 69%–70%, other income/(expense) of approximately $(700) million and an effective tax rate of approximately 18% were unchanged. Worldwide **Eliquis revenue growth guidance was raised from 10%–15% to 20%–25%** versus 2025. Guidance excludes future strategic acquisitions and divestitures, unidentified specified items, and Acquired IPRD charges and licensing income incurred after June 30, 2026, and assumes mid-July 2026 exchange rates. ### Business development and pipeline in 2026 In **May 2026** the company entered **global strategic collaboration and license agreements with Hengrui** covering a portfolio of **13 early-stage assets in oncology, hematology and immunology**; BMS holds exclusive worldwide rights outside Chinese mainland, Hong Kong SAR and Macau SAR, and Hengrui holds rights within that territory. Also in May 2026 it announced a strategic agreement with **Anthropic** to deploy Claude across research, clinical development, manufacturing, commercial and corporate functions, and in **April 2026** it entered agreements with **Dr. Reddy's Laboratories** permitting an **Orencia biosimilar for intravenous administration** to be marketed in the U.S. upon approval and an **Orencia biosimilar for subcutaneous administration** to be marketed in the U.S. **as early as February 2028**. Under the BioNTech collaboration, BioNTech is to receive **$2.0 billion in aggregate anniversary payments, payable beginning in the third quarter of 2026 through 2028** absent prior termination by BMS, plus up to $7.6 billion of contingent development, regulatory and sales-based milestones. Regulatory and pipeline progress in 2026 included **Sotyktu** approvals for active psoriatic arthritis (FDA March 2026; European Commission May 2026; Japan May 2026); **Opdivo** in combination with AVD chemotherapy for previously untreated Stage III or IV classical Hodgkin lymphoma (FDA March 2026; EC June 2026, based on the Phase III SWOG 1826 study showing a 58% reduction in the risk of progression or death versus brentuximab vedotin plus AVD); **Breyanzi** approval in Japan for relapsed or refractory mantle cell lymphoma and marginal zone lymphoma (April 2026); FDA acceptance of the **iberdomide** NDA in relapsed/refractory multiple myeloma with a PDUFA date of **August 17, 2026**; FDA priority review acceptance of the **Camzyos** sNDA in adolescents with symptomatic obstructive HCM with a PDUFA date of **September 30, 2026**; positive interim Phase II data for **pumitamig** plus chemotherapy in previously untreated advanced NSCLC (ROSETTA Lung-02); and positive interim Phase III results for **iza-bren** in heavily pretreated metastatic triple-negative breast cancer and recurrent or metastatic esophageal squamous cell carcinoma, reported by partner SystImmune's parent Sichuan Biokin. ### Litigation developments In **May and June 2026** BMS received paragraph IV Notice Letters on **Camzyos** (mavacamten) from Aurobindo, Zenara, Micro Labs, Dr. Reddy's, Annora, Apotex and MSN, and initiated patent infringement actions against each in the District of Delaware. On **Eliquis**, BMS and Pfizer sued Azurity in the District of Delaware over a 505(b)(2) application challenging a formulation patent (not the composition-of-matter patent). European apixaban litigation is pending or concluded in more than twenty countries: the UK decision was finally negative and generics are on the market there; final positive decisions were obtained in Norway, Spain, Sweden and Switzerland, and initial positive decisions in France, Belgium, Croatia, Hungary and the Netherlands became final following settlement; initial negative decisions in Finland, Ireland and Slovakia were overturned on appeal in Finland and Ireland (Ireland now settled); an appeal is pending in Denmark; and one or more generics have entered the market in Poland while proceedings continue. Elsewhere: the Supreme Court **denied BMS's certiorari petition in its IRA constitutional challenge in May 2026**, after the Third Circuit affirmed against it in September 2025. The **HRSA 340B** appeal over the cash rebate model was argued in the D.C. Circuit in November 2025. The court granted **final approval of the Celgene Securities Class Action settlement in May 2026**. In the contingent value rights litigation, the court found the plaintiff to be successor trustee in December 2025 while dismissing two of five claims, and stayed proceedings on the original trustee's putative crossclaims in May 2026; a separate individual CVR holder's suit was dismissed with prejudice in May 2026. In the **Pomalyst antitrust class action**, the court denied leave to amend and entered judgment for defendants in March 2026, and plaintiffs appealed to the Second Circuit in April 2026. The **Plavix** action brought by the Texas attorney general and a qui tam relator was remanded to Harrison County state court in March 2026, with no trial date set. --- ## Subsequent events Events after the June 30, 2026 period end, as disclosed in the Form 10-Q (accession 0000014272-26-000020) and the earnings release furnished with the Form 8-K dated July 30, 2026 (accession 0000014272-26-000018): - **Hengrui collaboration closed in July 2026.** The global strategic collaboration and license agreements entered in May 2026 with Hengrui, covering 13 early-stage assets in oncology, hematology and immunology, closed in July 2026. BMS will pay Hengrui an **upfront payment of $600 million in the third quarter of 2026** and a **$175 million anniversary payment in 2027**, with Hengrui eligible for a **second $175 million anniversary payment in 2028** absent prior termination by BMS, up to **$14.3 billion of contingent development, regulatory and sales-based milestones**, and tiered royalties on future net sales of all products outside the Hengrui Territory (Chinese mainland, Hong Kong SAR and Macau SAR). - **BioNTech anniversary payments begin.** The **$2.0 billion of aggregate anniversary payments** owed to BioNTech under the pumitamig collaboration become payable **beginning in the third quarter of 2026** and run through 2028, absent prior termination by BMS. - **mezigdomide NDA accepted (July 13, 2026).** The FDA accepted the New Drug Application for mezigdomide with carfilzomib and dexamethasone in relapsed or refractory multiple myeloma and granted a **PDUFA date of May 13, 2027**, based on the Phase III SUCCESSOR-2 trial, in which the combination showed a 52% reduction in the risk of disease progression or death versus carfilzomib and dexamethasone alone. - **Reblozyl sBLA accepted (July 30, 2026).** The FDA accepted the supplemental Biologics License Application for Reblozyl with concomitant JAK inhibitor therapy in adults with myelofibrosis-associated anemia receiving red blood cell transfusions, supported by the Phase III INDEPENDENCE study, with a **PDUFA date of March 11, 2027**. - **Arkansas 340B action (July 2026).** The Arkansas Attorney General filed a complaint in the Circuit Court of Polk County, Arkansas against BMS, other pharmaceutical manufacturers and a non-manufacturer technology vendor, alleging that policies conditioning 340B discounts on the use of a limited number of contract pharmacies and/or the submission of claims and utilization data violate the Arkansas Deceptive Trade Practices Act. The complaint seeks civil penalties and injunctive relief. - **NVIDIA collaboration expanded (July 2026).** The company announced an expansion of its existing collaboration with NVIDIA to deploy NVIDIA's Vera Rubin NVL72 AI infrastructure for running predictive models at scale and training large AI models on BMS's own data. No financial terms were disclosed. - **Full-year 2026 guidance raised (July 30, 2026).** Non-GAAP revenue guidance was raised to approximately $49.0–$50.0 billion and non-GAAP diluted EPS guidance to $6.75–$7.00, with worldwide Eliquis revenue growth guidance raised to 20%–25%, as set out under "Guidance" above. The Form 10-Q for the period ended June 30, 2026 contains no separate subsequent-events note; the items above are disclosed within its notes and management's discussion and in the earnings release furnished the same day. No acquisitions or divestitures of businesses were disclosed as having been agreed or completed after June 30, 2026.