Bristol-Myers Squibb Co reported higher-than-expected quarterly earnings, helped by cost cuts and lower taxes, but sales missed Wall Street estimates, and the U.S. drugmaker's shares fell.
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The company on Tuesday said it had earned $937 million, or 56 cents per share, in the first quarter, compared with $609 million, or 37 cents per share, a year earlier.
Excluding special items, the profit came to 46 cents per share. Analysts on average were expecting 43 cents, according to Thomson Reuters I/B/E/S.
The company's effective tax rate was 5 percent, compared with 7.6 percent a year earlier.
Bristol-Myers also benefited from the recent sale of its diabetes drugs business to longtime partner AstraZeneca Plc .
Bristol-Myers raised the lower end of its 2014 profit forecast to $1.70 a share, excluding special items, from $1.65 while keeping the top end at $1.80.
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Sales fell 1 percent to $3.81 billion, about $80 million shy of Wall Street expectations.
Shares of Bristol-Myers were down 2.2 percent at $49.24 in trading before the market opened.
A kind of merger fever seems to have swept the drug industry in the past week, with Pfizer Inc on Monday disclosing it had been rebuffed after offering to pay almost $100 billion to acquire AstraZeneca. But the biggest U.S. drugmaker vowed to continue its pursuit of its British rival and to domicile the combined company in Britain in order to achieve lower taxes.
Last week, Canada's Valeant Pharmaceuticals and activist investor Bill Ackman said they had made an unsolicited $47 billion bid to buy Botox maker Allergan Inc.
By contrast, Bristol-Myers Squibb has been known for building its drug pipeline by steadily pursuing smaller deals, which it calls its "string of pearls" strategy.
In keeping with that pattern, Bristol-Myers on Tuesday said it would spend $175 million to acquire privately held iPierian and its early-stage drugs to treat neurodegenerative diseases, including palsy. The purchase price ultimately could include up to $550 million more in milestone payments, plus royalties on sales of iPierian drugs.
Sales of Bristol Myers' Sprycel leukemia drug rose 26 percent to $342 million in the first quarter, while sales of melanoma treatment Yervoy fell 8 percent to $271 million. Orencia, used to treat rheumatoid arthritis, rose 7 percent to $363 million.
Combined marketing and advertising costs fell by $132 million in the quarter, while research spending rose only slightly.