Bristol-Myers Squibb ($BMY) is joining the chorus of drugmakers bewailing Europe's troubles. Economic crisis means cash-strapped countries aren't paying their bills on time, putting a pinch on pharma payables, BMS Europe chief Ron Cooper told Dow Jones. Meanwhile, drug-price cuts and austerity-level spending exacerbate the pain.
The sovereign debt crisis has an immediate effect on payables, Cooper said. It's not just Greece that's in arrears with pharma. "Many of these countries are taking increasing amounts of time to actually pay," he told Dow Jones. But it's also a longer-term threat, because financial limitations can in turn limit countries' willingness to pay for new meds.
However, luckily for BMS, it has a promising new drug to help offset these roadblocks to European growth. Yervoy, the company's breakthrough treatment for advanced melanoma, got the final nod from European regulators yesterday. Given that it's the first new treatment in decades, and the first approved treatment to significantly extend patients' lives, even budget-minded governments are likely to dig deep into their pocketbooks to pay the (steep) cost.
Pricing for Yervoy in Europe will be roughly equal to U.S. pricing: €21,000, or $29,927, compared with $30,000 per infusion. But Cooper figures that because of the small number of eligible patients, the impact on healthcare budgets will be limited, Reuters reports. BMS counts some 8,000 people have advanced melanoma in France, Italy, Germany, Britain and Spain combined.
"Our hope for continued growth in Europe is based on driving more volume and adding new products," Cooper told the news service. "Luckily we have a strong pipeline and that gives us opportunities to grow volume, sell new products and hopefully overcome some of those significant price impacts."