David Elkins
Chief Financial Officer at Bristol-Myers Squibb
Thank you, Chris, and thanks to all of you for joining our third quarter earnings call.
Turning to slide 13. Let's discuss our top line performance unless otherwise stated all comparisons are made versus same period in 2022 and sales growth rates will be discussed on an underlying basis, which excludes the impact of foreign exchange. Total company sales in the third quarter were $11 billion driven by continued growth of our in-line and new product portfolio, offset by the expected decline in Revlimid sales.
Let's move to our new product portfolio on slide 14. During the quarter, we delivered solid growth for the portfolio with $928 million in revenue. Growth was strong across the portfolio. Though we have seen an impact of Abecma from both manufacturing site maintenance in June and from increased availability and usage of alternative BCMA targeting therapies for multiple myeloma. Based on our performance year-to-date, we now expect a new product portfolio to deliver roughly $3.5 billion for the full year 2023. This was primarily due to the impacts of our cell therapy franchise particularly Abecma. As Chris mentioned, we are laser-focused on continuing to accelerate growth of our in-line and new product portfolio into the next year and beyond.
Let's discuss the performance of our solid tumor products on Slide 15. Our flagship oncology product Opdivo continues to grow well with sales up 11% globally. In the U.S., Opdivo grew 9% primarily driven by demand. Sequentially, sales grew double digit driven by demand and a reversal of roughly $50 million of unfavorable buying patterns in the second quarter. Outside the U.S., third quarter revenues increased 15% primarily driven by demand for indications such as lung and gastric cancer. This performance along with potential new launch opportunities and peri-adjuvant lung and first-line bladder, as well as in recently approved adjuvant melanoma indication reinforce our confidence in the continued growth for Opdivo.
As Chris mentioned earlier, we now have positive data for the subcu formulation. We believe this supports the potential for an important new option for patients and strengthens the franchise longevity into the next decade. With respect to our next-generation IO asset Opdualag revenue nearly doubled, as we build share in first-line melanoma. In the U.S., we now see market share of roughly 25% with additional room to grow particularly in the approximately 15% of patients that are still receiving PD1 monotherapy. Opdualag has become a new standard-of-care in patients with metastatic melanoma where BMS total share of 65% in this important market.
Let's now turn to cardiovascular on Slide 16. Eliquis continued to grow with $2.7 billion in revenue in the quarter. In the U.S., sales grew 4% year-over-year driven by strong demand growth, offset by unfavorable gross to nets due to channel mix including impact of approximately $75 million in Q3. Internationally, sales were primarily impacted by generic entries in Canada and the UK and pricing pressures we mentioned in the past. At the same time, we're encouraged have successfully defended our IP in several EU countries this year including France, Norway and Sweden.
Moving to Camzyos our first in-class obstructive HCM product, we are pleased with the continued growth of the product delivering $68 million of revenue in the quarter. In the U.S., we added roughly 1,000 patients both to our hub and to commercial defense. We are very encouraged to see good persistence with roughly 3,500 patients now on commercial drug. Our patient base continues to grow as we steadily bring more patients under treatment and convert to commercial defense.
Turning to our hematology products on slide 17. Starting with Revlimid, global sales in the quarter with just over $1.4 billion. At this point, we expect revenues of approximately $6 million for the full year primarily due to higher level of demand for lenalidomide. Now on to Pomalyst, global revenues were down 2% versus prior year, mainly due to free product dynamics in the U.S. we described in July. Internationally, demand for Pomalyst was stable. Revenues also benefit from a $40 million clinical supply purchased during the quarter.
Turning to Reblozyl which generated revenues of $248 million in the quarter. In the U.S. revenue growth accelerated increasing 28% year-over-year primarily driven by increased demand. With the commands approval, we are seeing increased use in first-line as well as an increase in second-line patients that are rapidly switching from ESAs to Reblozyl along with the continued increase in duration of treatment. Though it's early in the launch in first-line MDS, we're hearing very positive feedback on the profile, especially in the community setting. Overall, we're encouraged by the strong label for Reblozyl in first-line MDS associated anemia and we believe it sets us well to deliver this medicine to more patients with this disease.
Moving to Abecma with revenue of $93 million in the quarter. This was impacted by the manufacturing site maintenance in June and the use in availability of other BCMA targeting agents.
Turning to Reblozyl, sales in the quarter were $92 million, more than double versus prior year and down slightly compared to prior quarter due to timing of infusions. As we mentioned in July during the quarter we remained constrained with respect to vector. However, with continued strong demand in second and third line plus large B-cell lymphoma and an expected increase in supply next year, we are confident in our ability to grow in 2024 and beyond. Let's move to our immunology products on slide 18. Global sales for Zeposia were $123 million, up 75% compared to prior year. In the U.S. in addition to $15 million contribution due to favorable gross-to-net and inventory in the quarter, we continue to be pleased with the momentum in multiple sclerosis with the best-in class share within the S1P class and continued volume growth in very competitive ulcerative colitis market. Outside the U.S., sales increased mainly due to demand in and as.
Turning to Sotyktu. Underlying launch trends remained strong. Sales in the quarter were $66 million which included a clinical supply purchase of approximately $30 million and we saw continued strong volume demand during the quarter. With over 38,000 script equivalents dispensed since launch, we delivered over 15,000 script equivalents in the U.S. during the third quarter. Within the oral category, our share is now roughly 40% reinforcing that Sotyktu is establishing a position as the oral of choice in this market and we are making progress converting covered CVS patients from the free drug program to commercial dispense. We expect this will take on average two to three months per patient. Building on our momentum, we continue to expect the further strengthening of access next year.
Now moving to the P&L on 19. I will focus my remarks on a few non-GAAP key line items having just covered sales performance. Compared to Q2 gross margin was favorably impacted by-product mix. Acquired in-process R&D in the quarter was $80 million, which was partially offset by $12 million of licensing income resulting in a net impact of $0.03 cents of EPS. The reduction in the effective tax-rate during the quarter was primarily due to recently issued Section 174 guidance regarding deductibility of certain research and development expenses. This resulted in an adjustment in the quarter to our estimated tax rate. Overall, third quarter earnings per share was $2 per share, growing approximately 1%.
Turning to the balance sheet and capital allocation on slide 20. Cash-flow generation and our balance sheet remained strong. Cash flow from operations in the quarter was approximately $4.8 billion with over $8 billion in cash and marketable securities on hand at the end of Q3. Our capital allocation approach remains focused on business development as a top priority with the planned acquisition of Mirati as an example. We also remain focused on growing our dividend and on opportunistic share repurchases. In this regard, during the quarter, we executed $4 billion ASR and expect that to be completed by the end-of-the year. Today we have roughly $2 billion of authorization outstanding.
Lastly, turning to our 2023 non-GAAP guidance on slide 21. We continue to expect revenue to decline in the low single digits compared to last year. As mentioned, we expect new products to be about $3.5 billion this year and for Revlimid to deliver about $6 billion. Turning to Opex, we continue to expect roughly low-single digit decline compared to last year, corresponding to roughly $4.4 billion expected in the fourth quarter. Based on the changes to the tax I described earlier, we are revising our full-year effective tax-rate to 15.5%. With respect to our earnings, we have increased the midpoint of our non-GAAP EPS guidance and narrowed the range to $7.50 to $7.65.
And with respect to our medium-term guidance on slide 22. As Chris described earlier, we reaffirm our low-to mid-single-digit revenue CAGR from 2020 to 2025 and the $8 billion to $10 billion growth from our in-line portfolio during this period. We have adjusted our new product portfolio target to greater than $10 billion in 2026, a year later than previously communicated. And with respect to operating margin, fixing our target to greater than 37% through 2025 to reflect continued strong profitability while enabling flexibility to invest in future growth and incorporating dilution from Mirati.
Now before we turn it over to question-and-answers, I'd like to recognize Giovanni's leadership for the company and thank him for his considerable contributions in transforming BMS. Also want to acknowledge the hard work of our teams around the world during the quarter. I know that our people remain focused on delivering for patients and we'll continue to do so under Chris' leadership moving forward.
I'll now turn the call back over to Tim, Giovanni and Chris for Q&A.
