Bristol-Myers to redraft accounts

Pharmaceutical giant Bristol-Myers Squibb has said it plans to restate its results to reflect the impact of excess stocks built up by drug wholesalers.

The company said the move would result in a downward revision of its sales and profits for some periods in 2000 and 2001, while its 2002 results would rise.

A total of about $2bn (£1.28bn) in sales revenue will be affected.

The redrafting exercise is intended to strip out sharp fluctuations in the company's sales figures after drug wholesalers built up huge supplies of unsold Bristol-Myers products.

Drugs glut

The company warned earlier this year that the supply overhang could cut its 2002 earnings by up to 50% compared with the previous year.

The affair is being probed by US regulators, who suspect that the firm may have offered wholesalers incentives to buy extra stock as part of a plan to generate a short-term sales boost.

The Securities and Exchange Commission, the main US stock market regulator, and state prosecutors in New Jersey are both conducting investigations.

"Restating will help put the inventory issue behind us as soon as possible and allow us to move forward," said Bristol-Myers chief executive Peter Dolan.

He added that the company was making "substantial progress" in reducing wholesaler stocks.

Profits tumble

News of the financial redraft came as Bristol-Myers said profits for the three months to September came in at $314m, 73% down on the same period last year.

The profits slump partly reflected a $367m decline in the market value of Bristol-Myers' stake in troubled biotech firm ImClone.

Bristol-Myers' sales for the July to September quarter were also lower, falling 12% compared with the same period last year to $4.2bn.

These figures are also likely to be affected when the company restates its results.