Bristol Myers BMY announced that the European Commission (EC) has approved the blockbuster immuno-oncology drug Opdivo (nivolumab) plus Yervoy (ipilimumab) for the first-line treatment of adult patients with unresectable or advanced hepatocellular carcinoma (HCC), a type of liver cancer.

This approval is based on results of phase III CheckMate -9DW clinical study demonstrating a statistically significant and clinically meaningful improvement in overall survival with Opdivo plus Yervoy compared to investigator’s choice of Lenvima (Lenvatinib) or Nexavar (sorafenib).

HCC accounts for 90% of liver cancer cases worldwide, which is the third most frequent cause of cancer death.

In August 2024, the FDA also accepted BMY’s supplemental biologics license application (sBLA) for Opdivo plus Yervoy as a potential first-line treatment option for adult patients with unresectable HCC and assigned a target action date of April 21, 2025.

We note that the FDA granted accelerated approval in 2020 for the combination of Opdivo plus Yervoy as a second-line treatment for patients with advanced HCC based on results from the phase II CheckMate -040 study.

Shares of BMY have risen 18% in the past year against the industry’s decline of 7%.

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More on BMY’s Opdivo and Yervoy

The combination of Opdivo and Yervoy is also approved for metastatic melanoma, first-line treatment of adult patients with metastatic non-small cell lung cancer, first-line treatment of adult patients with unresectable malignant pleural mesothelioma and first-line treatment of adult patients with intermediate or poor risk advanced renal cell carcinoma among others.

Opdivo, on a standalone basis, is also approved for a plethora of oncology indications. It continues to maintain momentum on consistent label expansions. The FDA approval of Opdivo Qvantig (nivolumab and hyaluronidase-nvhy) injection for subcutaneous use should help extend the impact of its immuno-oncology franchise to patients into the next decade.

The FDA also recently accepted BMY’s sBLA for Opdivo plus Yervoy as a potential first-line treatment option for adult and pediatric patients (12 years and older) with unresectable or metastatic microsatellite instability-high or mismatch repair deficient colorectal cancer (mCRC). The regulatory body granted the application Breakthrough Therapy Designation and Priority Review status and assigned the sBLA a target action date of June 23, 2025.

Approval of New Drugs is Imperative for BMY

BMY is banking on newer drugs like Opdualag, Reblozyl and Breyanzi to stabilize its revenue base amid generic competition for legacy drugs. Approval of additional new drugs is imperative for the company in such a scenario.

BMY recently won FDA approval for xanomeline and trospium chloride (formerly KarXT), an oral medication for the treatment of schizophrenia, in adults. The drug was approved under the brand name Cobenfy. The approval of Cobenfy for schizophrenia broadens BMY’s portfolio and validates the acquisition of Karuna Therapeutics.

Cobenfy represents the first new pharmacological approach to treating schizophrenia in decades. The initial uptake is encouraging, with sales of $10 million in 2024. This drug is expected to contribute meaningfully to BMY’s top line in the coming years as the company looks to expand the drug’s label into other indications (Alzheimer's disease and bipolar 1 disorder).

While BMY’s efforts to revive the top line in the face of generic challenges for key drugs are commendable, the outlook for 2025 does not look bright. Generic competition for Revlimid, Pomalyst, Sprycel and Abraxane is expected to result in a revenue decline of approximately 18-20% for the Legacy Portfolio in 2025.

BMY's Zacks Rank & Stocks to Consider

Bristol Myers currently carries a Zacks Rank #3 (Hold).

A couple of better-ranked stocks in the biotech sector are Gilead Sciences GILD and BioMarin Pharmaceutical BMRN, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Gilead Sciences

In the past 30 days, Gilead Sciences’ EPS estimate for 2025 has increased from $7.60 to $7.87. During the same timeframe, the figure for 2026 has increased to $8.27 from $7.92.

GILD’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 19.47%.

BioMarin Pharmaceutical

In the past 30 days, estimates for BioMarin Pharmaceutical’s 2025 EPS have increased from $4.01 to $4.24. Estimate for 2026 EPS has increased to $5.25 from $5.20 during the same timeframe. BMRN’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 32.36%.

 

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