UPDATED: Bristol-Myers finds silver (tax) lining after Hep C disaster
Bristol-Myers Squibb watched its coveted hepatitis C drug 094 go down the drain last year after discovering safety hazards in a midstage study. Yet the pharma giant ($BMY) managed to ease some of its financial pain from the failed program with a tax benefit that ended up lifting its fourth-quarter profits 8.6%, the Wall Street Journal's Peter Loftus reported.
The tax code came to Bristol's rescue, as the company captured a $392 million tax benefit stemming from the huge loss Bristol took after 094 fizzled. A patient died during the study of the 'nuc' against liver-damaging hep C and others were hospitalized. Bristol wrote down $1.8 billion after flushing the drug program, which it took over through the $2.5 billion buyout of Inhibitex last year.
As Loftus points out, Bristol took a pounding last year with almost all of its Plavix franchise wiped out from generic drug competition. Without the tax benefit from the 094-related capital loss and other items, the company's earnings would have dropped from 53 cents per share to 47 cents a share.
Lawyers and their clients have been chasing after Bristol, accusing the company of rushing into the Phase II study of 094 in a way that put patients at risk. WSJ reported today that Bristol is about to clear that cloud with an $80 million settlement with 15 patients. The patients have agreed in principle but the deal still has to be signed, sealed and delivered.
Indeed, that program is dead yet the race lives on to advance new all-oral regimens against hep C. Bristol highlighted in an earnings report the continued development of the NS5A candidate daclatasvir, asunaprevir and BMS-791325.
Gilead Sciences ($GILD) has taken the lead to advance all-oral combos for the disease in the U.S. Yet Bristol has told FierceBiotech that it could be the first to hit the market with an interferon-free regimen in Japan, with markets in the West to follow.
Bristol-Myers begins pricey post-mortem cleanup following 094 disaster
Hep C patients claim Bristol-Myers rushed into trial
Casualties of an R&D war? Hep C trial patients accuse Bristol-Myers of recklessness
Bristol-Myers hep C trial hits the skids on safety concern