Bristol Myers’ schizophrenia drug stumbles while growth outlook remains under pressure

Bristol Myers Squibb’s (NYSE: BMY) newly acquired schizophrenia drug, Cobenfy, has failed to meet expectations in a key late-stage trial, raising fresh doubts over the US pharmaceutical group’s growth prospects.

The company said in April that topline results from the recent Phase 3 ARISE study showed Cobenfy did not demonstrate sufficient benefit as an add-on therapy. The treatment — which targets muscarinic receptors in the brain rather than relying on dopamine-blocking mechanisms like existing antipsychotics — had been hailed by analysts as a potential game-changer. It was approved by the US Food and Drug Administration (FDA) in September for use as a monotherapy.

Cobenfy entered Bristol Myers’ portfolio through its acquisition of Karuna Therapeutics in March 2024, a deal that marked the company’s return to neuroscience. The drug is forecast to reach blockbuster status, with projected global sales of $1 billion by 2027 and a peak of $5.4 billion.

Despite the Karuna deal helping diversify Bristol Myers’ pipeline, the company remains under pressure to offset declining sales from older therapies. Analysts expect total revenue to fall -4% year-on-year in 2025 to $46 billion, weighed down by competition from generics, biosimilars and rival branded drugs. The company’s research pipeline also faces the usual headwinds of costly clinical trials and regulatory uncertainty.