 has unveiled an expanded cost-cutting initiative aimed at saving an additional $2 billion by the end of 2027.){kind=link}
Pharmaceutical giant Bristol Myers Squibb (NYSE: BMY) has unveiled an expanded cost-cutting initiative aimed at saving an additional $2 billion by the end of 2027.
This move follows its previously announced “Strategic Productivity Initiative,” which targeted $1.5 billion in savings by 2025. In total, the company now plans to reduce costs by $3.5 billion as it navigates revenue declines and increasing competition from generic drugs.
Workforce Reductions and Strategic Adjustments
As part of its cost-cutting measures, Bristol Myers Squibb will lay off approximately 6% of its global workforce—around 2,200 employees. The company also intends to streamline operations by consolidating office locations, reducing management layers, and optimizing its drug development pipeline.
“We are taking decisive action to improve our operational efficiency while continuing to invest in the long-term growth of our innovative pipeline,” said Giovanni Caforio, Executive Chairman of Bristol Myers Squibb.
Addressing Revenue Declines
The cost-cutting initiative comes as the company faces increasing revenue pressure due to patent expirations and the rising availability of cheaper generic alternatives to some of its best-selling drugs.
Bristol Myers Squibb anticipates a sharper revenue drop in 2025 but aims to reinvest a significant portion of the cost savings into high-growth opportunities, including oncology, immunology, and cardiovascular treatments.
Market Reaction and Future Outlook
Following the announcement, Bristol Myers Squibb’s stock experienced a decline as investors reacted to the forecasted revenue drop. Analysts note that while cost-cutting is necessary, the company must demonstrate strong performance in its pipeline developments to sustain long-term growth.
Despite the challenges, Bristol Myers Squibb remains committed to innovation and strategic investments. The company continues to develop promising therapies and expand its presence in emerging markets.
Conclusion
With a total of $3.5 billion in planned cost reductions, Bristol Myers Squibb is making significant adjustments to stay competitive in a rapidly evolving pharmaceutical landscape. Investors and industry watchers will be closely monitoring the company’s next moves as it works to balance efficiency with innovation.
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