Dr. Reddy's Laboratories Seeks FDA Approval for Orencia Biosimilar
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Source: seekingalpha
- FDA Review Application: Dr. Reddy's Laboratories has received FDA acceptance for its biosimilar DRL_AB, which, if approved, will be available as an intravenous infusion for rheumatoid arthritis and psoriatic arthritis patients, marking a significant advancement in the company's biopharmaceutical endeavors.
- Market Potential: Orencia generated $2.7 billion in revenue for Bristol-Myers Squibb in 2025, reflecting a ~1% year-over-year decline, yet demonstrating robust market demand; Dr. Reddy's biosimilar could directly compete in this lucrative market if approved.
- First Applicant: The company submitted its 351(k) Biologics License Application in December, becoming the first to seek U.S. approval for an off-patent version of Orencia, showcasing its pioneering position in the biosimilar sector.
- Interchangeability Goal: Dr. Reddy's aims for DRL_AB to achieve interchangeable status, which, if granted, would allow the drug to be substituted at the pharmacy level without the need for the prescribing healthcare provider's intervention, simplifying the medication process for patients and enhancing market acceptance and competitiveness.
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Analyst Views on BMY
Wall Street analysts forecast BMY stock price to fall
20 Analyst Rating
8 Buy
11 Hold
1 Sell
Moderate Buy
Current: 60.300
Low
37.00
Averages
55.86
High
68.00
Current: 60.300
Low
37.00
Averages
55.86
High
68.00
About BMY
Bristol-Myers Squibb Company is a global biopharmaceutical company. It is engaged in the discovery, development and delivery of transformational medicines for patients facing serious diseases in areas: oncology, hematology, immunology, cardiovascular, neuroscience and other areas. Its growth portfolio includes Opdivo (nivolumab), Opdivo Qvantig (nivolumab and hyaluronidase-nvhy), Yervoy (ipilimumab), Reblozyl (luspatercept-aamt), Opdualag (nivolumab and relatlimab-rmbw), Breyanzi (lisocabtagene maraleucel), Camzyos (mavacamten), Zeposia (ozanimod), Abecma (idecabtagene vicleucel), and Sotyktu (deucravacitinib). Its other growth products include Onureg, Inrebic, and Empliciti. Its legacy portfolio includes Eliquis (apixaban), Revlimid (lenalidomide), Pomalyst/Imnovid (pomalidomide), Sprycel (dasatinib), and Abraxane (paclitaxel albumin-bound particles for injectable suspension). Opdivo (nivolumab) is a fully human monoclonal antibody that binds to the PD-1 on T and NKT cells.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Financial Stability: Despite the looming patent expirations, Bristol Myers Squibb offers a 4.2% dividend, with payouts consuming less than half of earnings, indicating financial resilience even amid business contractions.
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Dr. Reddy's Laboratories Seeks FDA Approval for Orencia Biosimilar
- FDA Review Application: Dr. Reddy's Laboratories has received FDA acceptance for its biosimilar DRL_AB, which, if approved, will be available as an intravenous infusion for rheumatoid arthritis and psoriatic arthritis patients, marking a significant advancement in the company's biopharmaceutical endeavors.
- Market Potential: Orencia generated $2.7 billion in revenue for Bristol-Myers Squibb in 2025, reflecting a ~1% year-over-year decline, yet demonstrating robust market demand; Dr. Reddy's biosimilar could directly compete in this lucrative market if approved.
- First Applicant: The company submitted its 351(k) Biologics License Application in December, becoming the first to seek U.S. approval for an off-patent version of Orencia, showcasing its pioneering position in the biosimilar sector.
- Interchangeability Goal: Dr. Reddy's aims for DRL_AB to achieve interchangeable status, which, if granted, would allow the drug to be substituted at the pharmacy level without the need for the prescribing healthcare provider's intervention, simplifying the medication process for patients and enhancing market acceptance and competitiveness.
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- Expected Market Reaction: Analyst rating adjustments typically trigger immediate market responses, and investors should monitor these changes to timely adjust their investment strategies and capitalize on potential market opportunities.
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- Patent Cliff Impact: Bristol Myers Squibb faces an unusually steep patent cliff, with projected sales declines of 48.9% to $2.9 billion for Revlimid and 61.7% to $493 million for Sprycel in 2025, significantly pressuring overall revenue.
- New Drug Potential: Cobenfy, a groundbreaking antipsychotic, could generate $3.4 billion in annual sales if approved by the FDA in 2026, potentially offsetting losses from Eliquis and Opdivo, thus enhancing future growth prospects for the company.
- Financial Stability: Despite the looming patent expirations, Bristol Myers Squibb offers a 4.2% dividend, with payouts consuming less than half of earnings, indicating financial resilience even amid business contractions.
- Attractive Market Valuation: The stock currently trades at less than 10 times this year's earnings estimates, reflecting market awareness of the patent cliff, making it a potentially lucrative buy for investors looking for long-term gains.
See More
Bristol Myers Squibb Faces Steep Patent Cliff
- Patent Cliff Impact: Bristol Myers Squibb faces an unusually steep patent cliff, with Revlimid sales projected to decline by 48.9% to $2.9 billion in 2025 and Sprycel sales dropping 61.7% to $493 million, directly impacting revenue and market confidence.
- Key Drug Patent Expirations: The combined sales of top drugs Eliquis and Opdivo are expected to reach $24.4 billion in 2025, accounting for nearly half of total revenue, with U.S. patent protection expiring between 2027 and 2029, leading to fierce generic competition.
- New Drug Development Potential: Despite challenges, Bristol Myers Squibb's growth portfolio saw a 23% sales increase to $16.3 billion in 2025, with Cobenfy, an innovative antipsychotic, potentially achieving $3.4 billion in annual sales by 2030 if FDA approved, which could offset future revenue losses.
- Dividend Appeal: The company currently offers a 4.2% dividend yield, with payouts consuming less than half of earnings, indicating financial stability, and providing investors with steady cash flow even amidst the looming patent cliff.
See More
Supreme Court Rules Trump's Tariffs Unconstitutional
- Tariff Ruling Impact: The Supreme Court's 6-3 decision deemed Trump's tariffs under the International Emergency Economic Powers Act unconstitutional, yet it does not affect tariffs under the Trade Expansion Act, leaving certain sectors to face ongoing cost pressures.
- Automotive Industry Strain: Major U.S. automakers like General Motors expect tariff costs between $3 billion and $4 billion this year, while Ford anticipates a flat $2 billion impact, although the Supreme Court ruling's immediate effects on these forecasts remain unclear.
- Pharmaceutical Uncertainty: The Trump administration has threatened tariffs on pharmaceuticals that could reach 250%, which, if enacted, would push drug companies to increase U.S. manufacturing, thereby impacting the industry's strategic direction despite current exemptions.
- Furniture Sector Challenges: The furniture industry continues to face a 25% tariff post-ruling, with expectations of an increase to 50% by 2027, disproportionately affecting smaller firms and leading to bankruptcies, such as that of American Signature Furniture.
See More
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- Tariff Ruling Impact: The Supreme Court's ruling that Trump's 'reciprocal' tariffs are unconstitutional provides some relief for consumer companies facing high import costs, yet it does not eliminate the burden of existing tariffs across various sectors.
- Automotive Industry Pressure: The automotive sector continues to face billions in tariff costs, with a 25% tariff imposed on imported vehicles and parts last year, although some countries have negotiated reductions to 10%-15%, the overall impact on the industry remains unclear.
- Pharmaceutical Uncertainty: The pharmaceutical industry is at risk of potential tariffs reaching 250%, as Trump has threatened such measures, which, if enacted, would compel drug manufacturers to produce domestically, adding significant uncertainty to the sector.
- Furniture Industry Struggles: The furniture industry still faces a 25% tariff post-ruling, with expectations of an increase to 50% by 2027, severely impacting smaller companies and leading to bankruptcies, highlighting the ongoing challenges in this sector.
See More
Dr. Reddy's Laboratories Seeks FDA Approval for Orencia Biosimilar
- FDA Review Application: Dr. Reddy's Laboratories has received FDA acceptance for its biosimilar DRL_AB, which, if approved, will be available as an intravenous infusion for rheumatoid arthritis and psoriatic arthritis patients, marking a significant advancement in the company's biopharmaceutical endeavors.
- Market Potential: Orencia generated $2.7 billion in revenue for Bristol-Myers Squibb in 2025, reflecting a ~1% year-over-year decline, yet demonstrating robust market demand; Dr. Reddy's biosimilar could directly compete in this lucrative market if approved.
- First Applicant: The company submitted its 351(k) Biologics License Application in December, becoming the first to seek U.S. approval for an off-patent version of Orencia, showcasing its pioneering position in the biosimilar sector.
- Interchangeability Goal: Dr. Reddy's aims for DRL_AB to achieve interchangeable status, which, if granted, would allow the drug to be substituted at the pharmacy level without the need for the prescribing healthcare provider's intervention, simplifying the medication process for patients and enhancing market acceptance and competitiveness.
See More
Wall Street Analysts Adjust Ratings
- Analyst Rating Changes: Top Wall Street analysts have adjusted their ratings on several companies, indicating a shift in market sentiment that could influence investor decisions and market trends.
- Overview of Updates: While specific upgrades and downgrades are not detailed, the overall rating changes may prompt investors to reassess their holdings, potentially affecting trading volumes and price fluctuations of the related stocks.
- Expected Market Reaction: Analyst rating adjustments typically trigger immediate market responses, and investors should monitor these changes to timely adjust their investment strategies and capitalize on potential market opportunities.
- Information Access: Investors can access a comprehensive view of rating changes through Benzinga's analyst ratings page, aiding them in making more informed investment decisions.
See More
