Pharmaceutical giants Bristol-Myers Squibb (BMS), Pfizer and Merck are approaching significant patent expirations for key drugs, commonly referred to as “patent cliffs.” At the J.P. Morgen Healthcare conference 2025, which ends today in San Francisco, the CEOs presented the strategies to deal with the expected revenue losses.
Bristol Myers Squibb (BMS):
Upcoming Patent Expirations:
Revlimid: Facing increased generic competition starting March 2025, with full generic market entry by 2026. The drug generated $4.4 billion in the first nine months of 2024, but BMS anticipates a decline to $2 billion to $2.5 billion in 2025.
Pomalyst and Sprycel: Expected to encounter generic competition in 2025. Pomalyst and Sprycel generated $2.7 billion and $1 billion, respectively, in the first nine months of 2024.
Strategic Responses:
Pipeline Development: BMS has 40 programs in mid- and late-stage development and aims to launch 10 new drugs with 30 label expansions over the next five years.
Operational Efficiency: The company plans to enhance workforce productivity and manage expenses carefully.
Revenue Projections: BMS expects its “growth portfolio” to account for more than 50% of total sales in 2025, positioning the company for top-tier growth by the decade’s end.BMS presentation
Pfizer:
Upcoming Patent Expirations:
Facing a “loss of exclusivity (LOE) wave” between 2026 and 2028, affecting drugs such as Inlyta, Xeljanz, Eliquis, Ibrance, and Xtandi. This wave is projected to impact annual revenues by $17 billion to $18 billion.
Strategic Responses:
Acquisitions: Pfizer has engaged in M&A activities, including the $43 billion acquisition of Seagen, to bolster its oncology portfolio. Acquired products are expected to contribute $20 billion in annual revenues by 2030.
Product Launches: The company is optimistic that new product launches will surpass Wall Street’s expectations, aiding in revenue recovery.Pfizer Investor Overview
Merck:
Upcoming Patent Expirations:
Keytruda: Patents set to expire in 2028 in the U.S. and 2030 in Europe. As the world’s top-selling cancer drug, Keytruda generated $25 billion in 2023 and $21.6 billion in the first nine months of 2024, accounting for approximately 40% of Merck’s revenue.
Strategic Responses:
Pipeline Expansion: Since 2021, Merck has nearly tripled its phase 3 development assets and invested about $40 billion in strategic business development.
New Formulations: Merck is accelerating the launch of a subcutaneous version of Keytruda, aiming for a 2025 release, to maintain market share post-patent expiry.
Growth Outlook: CEO Robert Davis expressed confidence in achieving growth through the LOE period, not just beyond it.
These strategies reflect the companies’ proactive measures to address the financial challenges posed by imminent patent expirations, focusing on innovation, acquisitions, and operational efficiency to sustain growth.Merck presentation
The patent cliff presents a formidable challenge, with combined losses from major players expected to reach tens of billions of dollars annually. However, the proactive measures highlighted at the J.P. Morgan Healthcare Conference demonstrate the resilience of the pharmaceutical industry. By prioritizing innovation, acquisitions, and operational excellence, Bristol Myers Squibb, Pfizer, and Merck are charting a course to sustain growth in a post-patent era. This strategic pivot not only addresses immediate challenges but also underscores their commitment to delivering groundbreaking therapies to patients worldwide.
