UPDATE 2-Bristol-Myers names Andreotti as CEO

* Plavix patent to expire on Andreotti's watch

* Cornelius to step down as CEO May 4 but remain chairman

* Shares unchanged (Adds analyst, Bristol executive comment, share price)

By Bill Berkrot

NEW YORK, March 2 (Reuters) - Bristol-Myers Squibb Co (BMY.N) named Chief Operating Officer Lamberto Andreotti as its chief executive, succeeding James Cornelius, who will step down May 4.

Cornelius, 66, will remain as chairman, the U.S. drugmaker said. Cornelius took over the helm of the company in 2006 after longtime CEO Peter Dolan lost favor with Wall Street.

Andreotti, a 59-year-old Italian citizen, now faces the challenge of steering Bristol-Myers Squibb through the 2012 patent expiration of the blood clot preventer Plavix -- the $8 billion a year drug it shares with French drugmaker Sanofi-Aventis (SASY.PA).

"I'm very aware of the pressure I will have and we will have in the next few years to deliver a better post-Plavix company," Andreotti told reporters on a conference call.

Andreotti's profile as a possible successor to Cornelius was significantly raised last March when he was promoted to president and elected to the board of directors. He had already been COO and was responsible for the global pharmaceutical business.

Separately last year, Andreotti, research chief Elliott Sigal, and Chief Financial Officer Jean-Marc Huet were appointed to sit with Cornelius on the Executive Committee, making them all potential candidates to become the next CEO.

"It was a completely logical succession plan and probably pretty well anticipated," Deutsche Bank analyst Barbara Ryan said of the choice of Andreotti.

"I think the fact that Jim Cornelius is going to stay on as chairman is a positive," Ryan added. "Investors like him a lot and it shows his continued commitment to building the company and its strategy."

Andreotti, who has been with Bristol-Myers for 12 years in senior executive positions, praised the company's research and development operation and said it was also well positioned to make acquisitions.

"We have both financial strength and financial flexibility," Andreotti said, noting that the company has about $10 billion in cash and marketable securities "and a strong balance sheet."

Bristol's so-called "string-of-pearls" strategy involves boosting revenue through a continuing series of small or mid-size deals.

"The focus is on delivering new products over the next five years that will bring the company through and out of the cliff as their current leading products lose patent protection," Ryan said.

Cornelius called Andreotti and Sigal "the primary architects" of Bristol-Myers' strategy of becoming a fully integrated biopharma company through its own R&D and through acquisitions.

"Lamberto has demonstrated extraordinary leadership as president and chief operating officer and I believe he is the natural candidate to replace me as CEO," Cornelius said.

He said the board had been planning for his succession for three years and did not use any outside help in the process.

"We didn't need the help of any executive search firm when we had the very best guy right here," Cornelius said, reminding reporters that he was reluctantly drafted to become CEO by the board after Dolan was pushed out.

"As you may know, I've retired as a senior executive many times," he joked, noting his prior retirements from both Eli Lilly (LLY.N) and Guidant Corp.

Rome-born Andreotti, an opera fan, pointed to 2013 as the first full year without Plavix as a patent-protected product.

From there, he said, the company is planning to "sustain growth to build an even better future starting in 2014."

Bristol-Myers shares were unchanged in extended trading from their New York Stock Exchange close at $24.72. (Reporting by Bill Berkrot; Additional reporting by Deena Beasley in Los Angeles; Editing by Richard Chang, Gary Hill)