Following its previous plan to cut $1.5 billion in costs by the end of 2025, multinational pharmaceutical company Bristol-Myers Squibb (hereinafter referred to as BMS) has recently announced another cost-cutting plan, aiming to reduce $2 billion in costs by the end of 2027.


BMS's financial report shows that the company achieved a revenue of $48.3 billion in 2024, representing a 7% year-on-year increase. However, BMS expects that due to an estimated 18%-20% revenue decline from mature products, its revenue for 2025 will be approximately $45.5 billion.


Cut Costs by $2 Billion Over the Next Three Years


While releasing the 2024 financial report, BMS announced a new cost-cutting plan to reduce costs by $2 billion by the end of 2027. BMS stated that based on this plan, cost reductions will be mainly achieved through organizational changes and improved operational efficiency. The savings will be removed from the company’s cost structure to make it leaner and more efficient, while also investing in growth products and promising scientific fields.


This is also the company's second move to cut costs within a short period. As early as April 2024, Bristol-Myers Squibb (BMS) announced a "streamlining" plan, aiming to achieve $1.5 billion in cost reductions by the end of 2025. Specific measures include layoffs, divestment of non-core assets, and the closure of certain R&D pipelines. In response to cost pressures and to optimize its business structure, BMS plans to lay off 2,200 employees in 2024. Additionally, the company is refining its product pipeline and has cut 12 clinical drug programs.


Just before announcing this cost-cutting plan, BMS had completed several acquisitions, including the $4.1 billion acquisition of RayzeBio, a radiopharmaceutical biotechnology company, in January 2024, gaining a radiopharmaceutical platform based on Actinium-225 (Ac-225) and several innovative products under development; and the $4.8 billion acquisition of Mirati Therapeutics, obtaining the lung cancer drug Krazati and multiple drug assets at clinical stages.


BMS CFO David Elkins pointed out that the vast majority of cost reductions come from BMS's traditional business, rather than the synergistic assets acquired through the company’s latest acquisitions. The company also stated in its announcement that, despite challenges, its focus remains on strengthening long-term growth capabilities.


BMS Currently Focuses on Five Core Therapeutic Areas: Oncology, Cardiovascular, Hematology, Immunology, and Neuroscience. BMS Has Not Disclosed Specific Details or Implementation Steps of the Latest Cost-Cutting Plan.


Mature products may face an 18%-20% revenue decline this year


BMS's 2024 financial report shows that the company achieved revenue of $48.3 billion during the reporting period, a year-on-year increase of 7%. According to the product life cycle, BMS categorizes its products into growth and mature types, with both categories generating similar revenue last year.


In 2024, Bristol-Myers Squibb (BMS) had a total of eight products with annual sales exceeding $1 billion. In the global biopharmaceutical field, drugs with annual revenue surpassing $1 billion are typically referred to as "blockbuster" drugs. Ranking first is the oral anticoagulant apixaban, which, 13 years after its approval, contributed $13.33 billion in revenue to BMS last year. As the world’s first PD-1 monoclonal antibody, nivolumab (Opdivo, commonly known as "O drug") fell short of the $10 billion mark last year, generating $9.304 billion in sales, representing a 3% year-over-year increase. The multiple myeloma drug lenalidomide ranked third, contributing $5.773 billion in revenue to BMS last year; however, due to the expiration of its patent, its revenue declined by 5% year-over-year.


BMS forecasts that the company's revenue in 2025 will be approximately $45.5 billion, with mature products potentially facing an 18%-20% decline in revenue. Particularly for lenalidomide, BMS anticipates that the drug’s revenue in 2025 will continue to decrease, reaching about $2 billion to $2.5 billion. In January this year, the CEO of BMS mentioned at the 43rd J.P. Morgan Healthcare Conference that the company’s mature products are confronting challenges from the patent cliff.


As mentioned above, BMS is also actively pursuing acquisitions to seek new products. In 2025, the company's R&D investment reached $11.159 billion, increasing by 20% year-over-year. BMS anticipates that growth products will contribute over 50% of revenue in 2025, with expectations to launch 10 new drugs within the next five years and achieve 30 new indications for existing drugs.


Reporter Zhang Xiulan from The Beijing News

Proofread by Zhai Yongjun