Bristol's earnings at risk as court shuts down Sprycel patent in Europe, analyst says

Loss of exclusivity on Sprycel could mean a hit of up to 8 cents on Bristol's 2017 EPS, Evercore ISI analyst Mark Schoenebaum figures.

Bristol-Myers Squibb can kiss a Sprycel patent in the EU goodbye—and it may need to kiss its current guidance goodbye, too.

Wednesday, an EU court shut down Bristol's appeal and invalidated a key patent protecting the cancer-fighter from generics. That's an event that wasn’t covered in the company’s 2017 guidance released last week, Evercore ISI analyst Mark Schoenebaum wrote in a note to clients. And the way he sees it, the event could dent earnings per share by up to about 8 cents.

“If the company chooses not to re-guide for 2017, they may have to control expenses more aggressively than has been assumed; they may have to forego spending on non-Sprycel priorities to hit their targets,” he wrote.

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Bristol-Myers did not respond to an immediate request for comment.

On the bright side, though? In the long-term, the impact of Sprycel—which generated about $380 million in EU sales last year—is “less important,” Schoenebaum figures. After all, the product is still covered in the U.S., and it had been set to lose EU exclusivity in 2020.

That’s good news for the New Jersey drugmaker, which has plenty of other things to worry about in light of its recent struggles with immuno-oncology hotshot Opdivo. The med recently ceded its lung-cancer lead to nemesis Keytruda, the Merck & Co. drug, after flopping a key monotherapy study. More recently, the Bristol-Myers announced a setback for its Opdivo/CTLA4 combo, too.

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