News about patents

Bristol Myers Squibb's Growth Portfolio rose 12% to $7.7 billion in the third quarter, supplying nearly all of the company's 7% revenue gain to $13.1 billion, while shares were roughly flat in midday trading. Adjusted EPS fell 17% to $1.35 from $1.63, mainly because of acquired IPRD charges for upfront payments on licensed drug candidates, which cost $0.58 a share net of licensing income. The Legacy Portfolio rose 1%, helped by Eliquis outpacing generic erosion, though Eliquis faces patent expiration later this decade. The company raised its 2026 revenue guidance to $49.75 billion to $50.25 billion, and the adjusted EPS range was updated to absorb the charges. The article says investors should watch whether the Growth Portfolio holds double-digit growth and whether the licensed programs produce data that justifies their cost.

Pfizer declared a $0.43 fourth-quarter dividend, its 352nd consecutive quarterly payout, which annualizes to $1.72 per share and a 5.9% yield, well above the roughly 1% average S&P 500 yield. The article asks whether the payout is sustainable, noting Pfizer halved its dividend in 2009 but has raised it every year since 2010. Eliquis and Xeljanz lose U.S. patent exclusivity this year, and Ibrance and Xtandi follow next year, which pressures revenue. Nurtec grew 18% in the second quarter, Lorbrena 37% and Padcev 23%, and free cash flow of about $11 billion over four quarters exceeded dividend payments by more than $1 billion. The author concludes that the dividend's durability depends on whether new pipeline drugs can replace the expiring ones.

QUALCOMM (QCOM) closed at $174.43 on October 12 and has returned 32.9% over six months, versus 21.2% for the Insider Monkey Billionaire Index and 14.0% for the State Street SPDR S&P 500 ETF Trust. Qualcomm earns from chip design (QCT) and from patent licensing (QTL), which charges handset makers whether or not the phone contains a Qualcomm chip. Last quarter QTL earned $881 million at a 69% margin, while the chip business earned $2.19 billion at a 26% margin. Chip revenue slipped, and a few handset customers, one of which designs its own chips, account for most of it; the shares remain roughly a third below their 52-week high. The stock trades at 19.65 times next year's expected earnings, and the article argues the market is pricing in customer concentration. It also notes that reported net margin sits above operating margin because of a one-off tax benefit.