Why I Think Bristol Myers Squibb Is Too Cheap to Miss

For investors in pharmaceutical companies, few things are more concerning than a loss of market share, particularly if it's because of the patent expiration of a blockbuster drug. Bristol Myers Squibb (NYSE: BMY) is currently tackling just such issues, with its lead immuno-oncology drug, Opdivo, taking a beating from Merck's (NYSE: MRK) market-leading immuno-oncology drug, Keytruda, across multiple cancer indications. Keytruda managed to secure approval from the U.S. Food and Drug Administration (FDA) ahead of Opdivo in the advanced melanoma indication in 2014, but success in the advanced non-small cell lung cancer (NSCLC) market catapulted Opdivo ahead of Keytruda in 2015. However, Keytruda took the lead again in late 2016 when it demonstrated clinical success as a first-line treatment for NSCLC, while Opdivo failed to make its mark in this indication. Optivo's global patents will begin to expire in 2026.

Revlimid, a blood cancer drug that Bristol Myers Squibb obtained in its recently completed mega-acquisition of Celgene, will be facing generic competition in the U.S. beginning in March 2022. Eliquis, the market-leading oral anticoagulant, will face patent expirations starting in 2026. All these are major challenges for Bristol Myers Squibb, considering that Opdivo, Revlimid, and Eliquis raked in global sales of $7.2 billion, $10.8 billion, and $7.9 billion, respectively, in fiscal 2019.

But there is much more to the Bristol Myers Squibb story than patent expirations. Here are some reasons why the company remains an attractive, safe pick for healthcare investors.

Source Fool.com