BMY Collaborates for Oncology Drug: Will This Boost Its Portfolio?

Bristol Myers Squibb BMY recently announced a strategic collaboration agreement with BioNTech BNTX for the global co-development and co-commercialization of the latter’s investigational bispecific antibody BNT327 across numerous solid tumor types.

BNT327, a next-generation bispecific antibody candidate, targets PD-L1 and VEGF-A. It is currently being evaluated in multiple ongoing trials with more than 1,000 patients treated to date, including phase III studies with registrational potential evaluating BNT327 as first-line treatment in extensive stage small cell lung cancer (ES-SCLC) and non-small cell lung cancer (NSCLC).

A phase III study evaluating the candidate in triple negative breast cancer (TNBC) is planned to start by the end of 2025.

BMY is looking to expand its pipeline/portfolio as the legacy portfolio is being adversely impacted due to continued generic impact on Revlimid, Pomalyst, Sprycel and Abraxane.

Per the terms, BMY will make an upfront payment of $1.5 billion to BioNTech. In addition, BNTX will receive $2 billion in non-contingent anniversary payments through 2028. BioNTech is also eligible to receive up to $7.6 billion in additional development, regulatory and commercial milestones.

Both companies will jointly share development and manufacturing costs along with profits on an equal basis.

Data from ongoing trials (on a preliminary basis) underscore the potential for combining anti-PD-L1 and anti-VEGF-A — two well-established therapeutic targets — into a single molecule to deliver synergistic clinical benefits for patients across multiple tumor types.

Competition in Dual Target Cancer Therapy Space

Developing bispecific antibodies that target two proteins, namely PD-1 and VEGF, has lately been one of the lucrative areas in cancer treatment attracting pharma giants Merck MRK and Pfizer PFE.

In November 2024, pharma giant Merck received an exclusive global license to develop, manufacture and commercialize LM-299, a novel investigational PD-1/VEGF bispecific antibody from LaNova.  Merck’s oncology portfolio boasts a blockbuster PD-L1 inhibitor, Keytruda, and the company is looking to build a diversified oncology pipeline spanning differentiated mechanisms and multiple modalities.

Last month, Pfizer inked a licensing agreement with 3SBio for the development, manufacturing and commercialization of SSGJ-707, a bispecific antibody targeting PD-1 and VEGF, outside China.

The candidate is already being evaluated in China for non-small cell lung cancer, metastatic colorectal cancer and gynecological tumors. Pfizer will also make an equity investment of $100 million in 3SBio upon close, subject to an agreement.

BMY’s Price Performance, Valuation and Estimates

Shares of Bristol Myers have lost 13.6% year to date compared with the industry’s decline of 3.3%.

From a valuation standpoint, BMY is trading at a discount to the large-cap pharma industry.  Going by the price/earnings ratio, BMY’s shares currently trade at 7.31x forward earnings, lower than its mean of 8.55x and the large-cap pharma industry’s 14.95X.

The Zacks Consensus Estimate for 2025 earnings per share has moved up to $6.85 from $6.75 in the past 60 days, while that for 2026 has moved south.

BMY currently carries a Zacks Rank #3 (Hold).  You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

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This article originally published on Zacks Investment Research (zacks.com).

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