Will Recent Label Expansions of Opdivo Help BMY Gain Momentum?

Bristol Myers’ BMY growth portfolio primarily comprises Opdivo, Orencia, Yervoy, Reblozyl, Opdualag, Abecma, Zeposia, Breyanzi, Camzyos, Sotyku, Krazati and others.

Among these, immuno-oncology drug Opdivo is the top revenue generator. The drug has performed impressively over the past few years due to the demand in several indications, including first-line lung, first-line renal and first-line gastric cancers, as well as adjuvant indications, with the approval of adjuvant esophageal and bladder cancers.

Sales of this drug totaled $2.26 billion in the first quarter of 2025, accounting for 20% of total revenues.

Meanwhile, Bristol-Myers is working on expanding the label of Opdivo. The European Commission (EC) recently approved the subcutaneous formulation of Opdivo across multiple solid tumor indications.

The EC also approved the perioperative regimen of neoadjuvant Opdivo and chemotherapy followed by surgery and adjuvant Opdivo for the treatment of resectable non-small cell lung cancer at high risk of recurrence in adult patients whose tumors have PD-L1 expression ≥1%.

In April 2025, the FDA approved the combination of Opdivo plus Yervoy as a first-line treatment for adult patients with unresectable or metastatic hepatocellular carcinoma (HCC), the most common primary liver cancer. The combination was earlier given accelerated approval as a second-line treatment for patients with advanced HCC. The EC also granted approval to the candidate for this indication.

The FDA approved this combination as a first-line treatment for adult and pediatric patients (12 years and older) with unresectable or metastatic microsatellite instability-high or mismatch repair deficient colorectal cancer.

BMY’s other top drugs are currently facing generic competition, which has adversely impacted the top line.

Competition for BMY’s Key Drugs

Oncology is a key therapeutic area of focus for Bristol Myers, which is developing and delivering transformational medicines in this space. However, BMY faces stiff competition from large pharma companies like Merck MRK and Roche RHHBY in this field.

The immuno-oncology space is primarily dominated by Merck’s high-profile blockbuster drug Keytruda (pembrolizumab).    

Keytruda has put up a stellar performance ever since its approval. It is currently approved for several types of cancer and alone accounts for around 50% of MRK’s pharmaceutical sales. Merck is currently working on different strategies to drive long-term growth of Keytruda.

RHHBY’s Tecentriq is its leading immuno-oncology drug for multiple indications. Roche has an extensive development program for Tecentriq, including multiple ongoing and planned phase III studies across lung, genitourinary, skin, breast, gastrointestinal, gynecological and head and neck cancers. Label expansion of the drug should further boost sales.

BMY’s Price Performance, Valuation and Estimates

Shares of Bristol Myers have lost 13.9% year to date compared with the industry’s decline of 2.1%.

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 7.37x forward earnings, lower than its mean of 8.53x and the large-cap pharma industry’s 14.93X.

The bottom-line estimate for 2025 has moved down to $6.76 from $6.89 in the past 60 days and that for 2026 has declined 4 cents.

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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