Bristol names Cornelius CEO

By Ransdell Pierson

NEW YORK (Reuters) - Bristol-Myers Squibb Co. (BMY.N) on Thursday named interim Chief Executive James Cornelius as CEO of the drugmaker for the next two years, and reported first-quarter earnings well above forecasts.

The company also announced a $1 billion deal with Pfizer Inc. (PFE.N) to help develop and sell Bristol's promising apixaban drug to prevent blood clots.

The drugmaker's shares fell 3.3 percent after analysts speculated its tie-up with Pfizer could deter other drugmakers from making an attempt to acquire Bristol.

The better-than-expected quarterly results were due largely to lower operating expenses and a tax rate barely one-third that of the 2006 period.

Cornelius, who has been interim head of Bristol-Myers since Peter Dolan was fired as chief executive last September, will be CEO through the company's annual stockholder's meeting in the spring of 2009, Bristol said.

Deutsche Bank analyst Barbara Ryan said Cornelius was given his two-year CEO contract because Bristol, which has been beset by generic competition and government investigations, could not lure an external candidate.

"We view this as a purely cosmetic move to minimize the distractions and questions created by his interim status," Ryan said.

Cornelius, former chairman of medical device maker Guidant, spearheaded its sale for $27 billion to Boston Scientific Corp. (BSX.N) just months before assuming his interim leadership role at Bristol.

His deal-making skills had fueled speculation that Cornelius would welcome overtures by other drugmakers to acquire Bristol and its experimental cancer drugs.

Sanofi-Aventis (SASY.PA) has been considered to be the most likely possible suitor because Bristol co-markets its blockbuster blood-clot drug Plavix and its Avapro blood-pressure treatment. Schering-Plough Corp. SGP.N has also been widely mentioned.

"(The) decision to appoint James Cornelius as permanent CEO will do little to stop the investment community's general belief that the company will be sold," said Prudential analyst Tim Anderson, who considers Sanofi the most likely bidder.

Although the apixaban deal with Pfizer may dampen enthusiasm among possible Bristol suitors, Ryan said "a potential takeout" by another drugmaker remains likely.

Bristol earned $690 million in the first quarter, or 35 cents per share, compared with $714 million, or 36 cents per share, in the 2006 period.

Excluding special items, it earned 38 cents per share. Analysts on average had expected 23 cents per share, according to Reuters Estimates.

Bristol raised its 2007 earnings forecast to between $1.30 and $1.40 per share, from an earlier view of $1.20 to $1.30, helped by lower taxes. Last year the drugmaker earned $1.09 per share.