BMS Closes Bay Area Cell Therapy R&D Center Amid $1.5 Billion Cost-Cutting Plan

Apr 28, 2024 16:59 CST Updated 16:59

Bristol-Myers Squibb

Biopharmaceutical and Nutritional Product R&D and Sales

On April 25, Bristol-Myers Squibb announced aA $1.5 billion cost-cutting plan will shut down a cell therapy R&D base located in California.The plant in Redwood City, California's Bay Area, will be closed, and employees who are not laid off will be relocated to another facility in Brisbane, also in the Bay Area.

Before this news was disclosed, the company had already announced it in the latest Q1 earnings call.Layoffs of approximately 2,200 people, accounting for about 6% of its global workforce.

Further Reading:Latest! Bristol-Myers Squibb Layoffs 2,200 Employees, Terminates Y Drug Development

After several large-scale acquisitions,New CEO Chris BoernerWill lead BMS through the "transition period" as the company undergoes a pipeline reorganization.

"Unfortunately, due to these changes, some of our employees have been affected," the spokesperson said in an email. "We remain committed to making the San Francisco Bay Area an important innovation hub."

BMS Set to Face Major Patent Cliff

On April 25, Bristol-Myers Squibb (BMS) announced its Q1 2024 performance:Revenue of $11.9 billion, a year-on-year increase of 5%; net loss of $11.1 billion, compared to a net profit of $2.262 billion in the same period last year.

BMS's main performance drivers are still the anticoagulant Eliquis, the PD-1 antibody Opdivo (O drug), and the anticancer drug Revlimid.In 2024 Q1, the sales of the three were $3.72 billion (+9%), $2.078 billion (-6%), and $1.669 billion (-5%), respectively.

It is also important to note that the key patents for Eliquis are set to expire between 2027 and 2029, while the patent for Opdivo will expire in 2028.

In response to this situation, BMS decided to undergo a reorganization. The 12 projects cut in the restructuring include: CTLA-4 antibody program, SIRPα antagonist, and BET inhibitor.

Meanwhile, in the past six months, BMS has successively acquired Karuna Therapeutics ($14 billion), RayzeBio ($4.1 billion), and Mirati Therapeutics ($4.8 billion). However, these acquisitions have also increased BMS's debt to over $55 billion, with plans to repay approximately $10 billion within the next two years.

In the Chinese market, in February 2024, multiple self-media outlets disclosed that Bristol-Myers Squibb (BMS) had transferred the sales rights of Opdivo (O drug) in certain provinces of China to Zai Lab. The two parties agreed on a broad market covering ten provinces in China, including Yunnan, Guizhou, Guangxi, Inner Mongolia, Xinjiang, Gansu, Ningxia, Qinghai, Hebei, and Shanxi. BMS will continue to focus on core markets, deepening and widening the coverage of Opdivo (O drug) and Yervoy (Y drug). BMS will continue to be responsible for formulating and implementing the overall immuno-oncology strategy in existing indications and future newly introduced indications, advancing related work in marketing, medical affairs, access, and registration.

Cell Therapy Remains a Key Project for BMS

November 2023, BMSLeadership Change: Former Chairman of the Board and CEO Giovanni Caforio Retires; Chris Boerner, Executive Vice President and Chief Commercial Officer, Succeeds as CEO.Chris BoernerJoined BMS in 2015, from the head of the U.S. commercial market to the head of the international market, and served as Chief Commercial Officer in 2018.

With the completion of the high-level changes, BMS has also begun its global restructuring.

This plant closure is also part of BMS's global restructuring.

According to the BMS website, the Redwood City site constitutes the company'sCancer Immunology and Cell Therapy Research Center.Most research focuses on the tumor microenvironment in order to "provide the scientific information needed for early drug development."

At the same time, the team at the Brisbane site has a broader scope of development, ranging from drug discovery to late-stage clinical trials, and also includes several therapeutic areas. BMS recently...Brisbane BaseExpanded by 27,000 square feet and held a ribbon-cutting ceremony in September last year.

Among the six CAR-T therapies approved by the FDA for the treatment of aggressive blood cancers, BMS sells two: Abecma and Breyanzi. Both therapies were acquired through BMS's 2019 purchase of Celgene (Celgene) obtained; whereas Breyanzi originated from Juno Therapeutics, which was previously acquired by Celgene.

BMS is also developing several CAR-T projects, one targeting GPRC5D for relapsed or refractory multiple myeloma, and another targeting CD19 for systemic lupus erythematosus (SLE). There is also a bispecific CAR-T therapy targeting BCMA and GPRC5D for advanced multiple myeloma.

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