David Elkins
Executive Vice President and Chief Financial Officer at Bristol-Myers Squibb
Thank you, Giovanni, and thank you all for joining our second quarter earnings call. Let's turn to Slide 12 to discuss our top line performance. Unless otherwise stated, all comparisons are made versus same period in 2022, and sales growth rates will be discussed on an underlying basis, which excludes the impact of foreign exchange. Total company sales in the second quarter were $11.2 billion, driven by continued strength of our in-line and new product portfolio, offset by the Revlimid decline that Giovanni discussed earlier. At the same time, we continue to be pleased with the strong growth of our new product portfolio, which grew 79% in the quarter. Moving to our new product portfolio on Slide 13. I'm incredibly proud of the strong momentum in the quarter and pleased with the growth.
The portfolio generated $862 million in sales in the quarter, already annualizing approximately $3.5 billion. New products grew significantly in the quarter and year-to-date, with 79% and 91% growth, respectively, versus last year. This strong performance was driven by several of our key products across the portfolio including Opdualag, Reblozyl and our cell therapies, Breyanzi and Abecma, as well as Camzyos and Zeposia. Moving to our solid tumor performance on Slide 14. Global Opdivo sales year-to-date were strong, growing 11% versus prior year, primarily driven by a continued demand for our newly launched and core indications. In the U.S., Opdiva grew 2% in the quarter versus last year, driven by demand in first-line lung, gastric and adjuvant bladder cancer indications, offset by customer buying patterns.
Sequentially, we estimate these buying patterns to be about $50 million to $100 million. Importantly, year-to-date revenues were up 9% versus last year, with continued growth expected this year. Outside the U.S., second quarter revenues increased 10%, driven by demand for recently launched indications and expanded access. Moving to the strong launch of Opdualag. Sales in the quarter grew significantly over prior year with revenues of $154 million. This also represents 31% growth versus prior quarter. We're extremely pleased with the launch of Opdualag in first-line melanoma with market share approaching 25% and continuing to be primarily sourced from PD-1 monotherapy. Positive experiences are driving repeat and expanded use across patients.
This momentum gives us confidence in the ability for Opdualag to become the new standard of care in first-line melanoma. Transitioning to our cardiovascular portfolio on Slide 15, beginning with Eliquis. We continue to be pleased with our leading OAC, which generated sales of approximately $3.2 billion globally, largely driven by the U.S., where sales grew 7% year-over-year driven primarily by demand. Sequentially, as is typical in the second quarter, we started to experience unfavorable gross to net adjustments as patients enter into the donut hole. As a reminder, these dynamics are more acute in the third and fourth quarters with the second half revenues being lower than the first half as we see each year. Outside the U.S., sales continue to be impacted primarily by generic entries in Canada and the U.K. as well as government pricing measures we mentioned in the past.
Turning to Camzyos, which generates sales of $46 million in the quarter, we are pleased with our continued progress. We are seeing healthy increases in patients being treated week-over-week with approximately 3,800 patients in our hub, of which approximately 2,500 patients are on commercial drug at the end of the quarter. We continue to make great progress with centers of excellence and broadening our prescriber base into the community setting. Patients have highlighted significant improvement in symptoms, which has resulted in strong adherence and minimal drop-off. We are delighted to have updated the label for Camzyos based upon the VALOR study, which reinforces the strong data seen in the EXPLORER study and further strengthens the clinical profile of Camzyos.
Outside of the U.S., we're excited to have received European approval last month, and look forward to making this first-in-class medicine available to more patients once we secure reimbursement. Now turning to our hematology portfolio on Slide 16, and I won't go into details on Revlimid and Pomalyst since Giovanni already discussed them earlier. I'll turn to Reblozyl. We had a strong quarter with revenues of $234 million, from 35% versus the prior year, primarily driven by demand. In the U.S., revenues grew 24%, primarily due to continued total prescription share growth driven by longer duration of treatment. Internationally, Reblozyl roughly doubled as we continue to secure reimbursement in additional countries. We have a strong foundation in place and look forward to the upcoming PDUFA date for Reblozyl in first-line ESA-naive MDS patients on the COMMANDS data, which will further accelerate growth of the band upon anticipated approval at the end of next month.
Moving on to our transformative cell therapy products, Abecma and Breyanzi, we continue to make progress at expanding capacity which has enabled robust sales of $232 million, growing 81% versus prior year, driven by strong demand. Abecma booked sales of $132 million globally, growing 48% versus last year, primarily due to demand and an increase in manufacturing capacity. We expect third quarter revenues to be lower than second quarter revenues due in part to planned manufacturing maintenance in June, with growth expected in the fourth quarter. Having said that, we continue to be pleased with the reproducibility of our efficacy and safety data in the real world and the reliability of our manufacturing processes, which were reinforced at ASCO. We also look forward to the upcoming PDUFA date in December for Abecma in early lines based on the KarMMA-3 trial.
Turning to Breyanzi, which generated sales of $100 million globally, more than doubling versus prior year and 41% sequentially, primarily driven by demand in second line and third line large B-cell lymphoma and increased manufacturing capacity. We are pleased with our success in increasing supply. While factor constraints will result in third and fourth quarter revenues being largely similar to second quarter, we are further building out our capacity for growth next year. Outside the U.S., we're excited about the EU approval of Breyanzi in second-line large B-cell lymphoma and look forward to bringing this treatment to early aligned patients in Europe. Now let's turn to our immunology portfolio on Slide 17. And Global sales of Zeposia in the quarter were $100 million, growing 52% compared to prior year and 28% sequentially.
In the U.S., growth was primarily driven by demand in multiple sclerosis and expanding contribution from ulcerative colitis. Outside the U.S., sales increased year-over-year, primarily due to demand in multiple sclerosis and securing reimbursement in additional countries. And lastly, turning to SOTYKTU. We are extremely pleased with the launch and progress we've made to date. Since launch, we have a greater than 23,000 script equivalents across bridge and commercial drug, nearly doubling volume in Q2 versus Q1. SOTYKTU's share of the oral market is now approaching 40%, continue to source more business from systemic-naive patients as well as Otezla in biologic experience patients. I'm also very pleased to report that we've made progress accelerating access, most notably, half of CVS plans were zero step edits effective mid-July. CVS indication-based plans account for approximately 30 million people or roughly 15% of the commercial covered lives, and we look forward to securing broader formulary access in 2024.
Outside U.S., we continue to be pleased with the strong launch performance in Japan and are working with various countries across Europe to secure reimbursement. Now moving to our second quarter P&L on Slide 18. I'll focus my remarks on a few non-GAAP key line items having just covered the $11.2 billion of sales in the quarter. In the quarter, gross margin of approximately 75% was primarily impacted by product mix. Operating expenses of $4.2 billion, excluding acquired in-process R&D, increased approximately 2% versus last year, largely driven by an increase in spend to support our new product portfolio. Acquired in-process R&D in the quarter was $158 million, which was partially offset by $20 million of licensing income. Overall, second quarter earnings per share was $1.75.
Turning to the balance sheet and capital allocation on Slide 19. Cash flow generation on our balance sheet remained strong. Cash flow from operations in the quarter was approximately $1.9 billion, with over $8.7 billion in cash and marketed securities on hand as of June 30. Cash flow from operations in the quarter was primarily impacted by a $3 billion tax payments in the quarter, which is dynamic as we've seen in previous years. Our priorities for capital allocation remain unchanged, our business development continuing to be a top priority and a focus on balance sheet strength as well as returning capital to shareholders. In the quarter, we repaid approximately $240 million of debt and $1.9 billion year-to-date, with an additional $2 billion maturing this year. Additionally, as Giovanni mentioned, we intend to execute a $4 billion ASR in the third quarter of this year, with approximately $2 billion remaining in our share repurchase authorization after the ASR.
Turning to our updated 2023 non-GAAP guidance on Slide 20. Our updated guidance reflects the decline of Revlimid and, to a lesser extent, Pomalyst revenues Giovanni mentioned earlier. We now expect 2023 revenues to decline in the low single-digit range on a reported and ex FX basis, and gross margin is expected to be approximately 76%. Excluding the impact of acquired in-process R&D, we continue to expect low single-digit decline in operating expenses, which reflects efficiency initiatives in MS&A as we continue to invest in our new product portfolio. For the third quarter, we expect total operating expenses to be largely similar to the second quarter and approximately $4.2 billion. Our tax rate is now expected to be 17.5%, reflecting changes in product mix and our earnings per share is now expected to be in the range of $7.35 to $7.65.
Lastly, turning to Slide 21. Despite Revlimid dynamics this year,, the future of our company was driven by our in-line and new product portfolio. Importantly, the robust growth of this business remains unchanged. We continue to expect the new product portfolio to roughly double versus prior year. We are continuing to diversify our business and have become less concentrated as a result. As you can see and as Giovanni mentioned earlier, in 2025, greater than 90% of our business is expected to come from our in-line and new product portfolios. We continue to expect low to mid-single-digit CAGR for 2020 to 2025 and reaffirm our midterm outlook. Before we move to Q&A, I want to reiterate and recognize the strong execution of our teams to accelerate the momentum of the future of our company, our new product portfolio. We remain laser-focused on bringing these transformational medicines to patients around the globe. I'll now turn the call back over to Tim and Giovanni for Q&A.
