The “strategic productivity initiative” to be executed by the American pharmaceutical company will also involve reducing management layers, rationalising its pipeline, consolidating sites, and decreasing third-party spending
Bristol Myers Squibb aims to generate savings of around $1.5bn by the end of 2025 through the internal cost savings programme. (Credit: Bristol-Myers Squibb Company)
Bristol Myers Squibb has announced plans to lay off nearly 2,200 employees this year as part of an internal cost savings programme aimed at navigating an impending transition period and driving long-term growth.
The move, which is being called as a “strategic productivity initiative” by the American pharmaceutical company is expected to generate savings of around $1.5bn by the end of 2025.
An announcement in this regard was made during the release of the company’s Q1 2024 results.
Bristol Myers Squibb said that the majority of the expected internal cost savings will be reinvested to fund innovation and drive growth.
As part of the initiative, the pharmaceutical company is concentrating its resources on research and development (R&D) programmes poised to yield the highest return on investment.
It will also give priority to investments in key growth brands and on streamlining operations throughout the organisation.
Bristol Myers Squibb’s cost savings initiative will also involve reducing management layers, rationalising its pipeline, consolidating sites, and decreasing third-party spending.
Bristol Myers Squibb board chair and CEO Christopher Boerner said: “We had a good start to 2024, with revenue growth, important advances in our pipeline and the closure of several strategically important transactions.
“Our focus remains on strengthening the company’s long-term growth profile.
“As a part of our continued evolution, we’re executing a strategic productivity initiative that will allow us to be more agile, drive efficiency across the company, and prioritise investing in opportunities where we see the greatest potential to get the most promising medicines to patients as quickly as possible.”
In Q1 2024, the company reported revenues of $11.9bn, reflecting a 5% increase year-over-year, or 6% when adjusted for foreign exchange impacts. The growth was primarily driven by Eliquis, Reblozyl, and Opdualag, although partially offset by Opdivo and Revlimid.
Its US revenues rose by 7% to $8.5bn, mainly attributable to Eliquis, Reblozyl, and Opdualag, but partially countered by Revlimid.
Opdivo revenues decreased to $1.2bn from $1.3 billion, marking a 10% decline primarily due to inventory and order timing, although partly offset by demand growth, said the firm.
Bristol Myers Squibb’s international revenues remained relatively unchanged at $3.4bn, primarily due to lower average net selling prices. However, this was partially offset by increased demand for Opdivo, Yervoy, and Reblozyl, said the company while the negative impact from foreign exchange was 5%.
In late 2023, the company announced the acquisitions of RayzeBio for $4.1bn and Karuna Therapeutics for $14bn.