9. Bristol-Myers Squibb

BMS had a tough year all in all.

R&D budget: $4.94 billion
Change from 2015: Down 16%
Total 2016 revenue: $19.42 billion
R&D budget as percentage of revenue: 25.4%

Bristol-Myers Squibb has long been highly regarded when it comes to its R&D—a small Big Pharma with a biotech bent, it has always funneled much money into its research budget.

In 2015, it spent $5.9 billion on research, but last year the amount fell substantially by $1 billion dollars. BMS still has one of the highest budgets in percentage of revenue terms, at just over a quarter, but this is a big drop from the 42% it was hitting in 2015.

Sure, its revenue jumped 17% between 2015 and 2016, but the company has still had to tighten its belt in the research department.

BMS had a tough year all in all when its Opdivo (nivolumab) franchise lost out big time to Merck and its rival I-O med Keytruda (pembrolizumab) when the pair released late-stage results for their respective meds in first-line lung cancer.

Merck hit the heights, but BMS hit the skids when its drug flopped in this lucrative disease setting back in the fall. Analysts then pinned BMS as a new M&A target, after its shares were hit after the Opdivo setback.  

A few months later, the company announced a major reworking of its R&D and manufacturing sites across the U.S. as it plans to shut down a host of centers while integrating others, forming part of its new research strategy announced earlier this year.

In a phased multiyear deal, the company said it would shut down its site in Hopewell, New Jersey, in a decade’s time. Bristol-Myers Squibb acquired the site for use as a research, data and administrative center nearly 20 years ago.

It will also not be renewing its lease at the Lake Union Steam Plant site in Seattle in 2019. The site is run by ZymoGenetics, which BMS bought in 2010 for nearly $900 million, and since 1993 has been predominately focused on the discovery and early manufacture of therapeutic proteins.

In December, BMS also confirmed previously announced plans that it will indeed close its Wallingford, Connecticut, site by the end of 2018. It will also no longer build a Connecticut development site as it had once planned.

RELATED: Bristol-Myers' R&D revamp mirrors upheaval in Opdivo's lung cancer fortunes

Where there are cuts, however, there are also other investments and changes. Bristol-Myers said it will be making investments in the construction of a new R&D building at its Lawrenceville, New Jersey, campus as it closes down its Hopewell location.

Bristol-Myers has not sat quietly on its deal-making and did go on something of an R&D spending spree last year, signing a pact in July for Sweden’s Cormorant Pharmaceuticals in an acquisition worth just north of $500 million, just four months after BMS paid $600 million to buy out biotech startup Padlock Therapeutics and its autoimmune R&D platform.

BMS also beefed up its fast-growing fibrosis portfolio after paying $100 million upfront to Japanese biopharma Nitto in November to develop and sell its early-stage liver-scarring candidate, as well as an option to buy into other antifibrotic meds.

There were other trials and setbacks, however, and after already taking several steps back from diabetes in recent years, Bristol-Myers in May last year pulled out of its deal with Biocon to develop oral insulin, the next big thing in diabetes.

India’s biggest biotech Biocon struck a deal with BMS in 2012 to take an option on the worldwide rights to the potential next-gen product, but BMS pulled out of the pact.

Also this year, BMS’ Francis Cuss left as CSO, replaced by Thomas Lynch, the former CEO of Massachusetts General Physicians Organization.

>> Check out BMS’ pipeline.

9. Bristol-Myers Squibb