Proxy Statement Pursuant to Section 14(a) of

the Securities Exchange Act of 1934 (Amendment No.    )

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

 

Notice is hereby given that the 2022 Annual Meeting of Shareholders (the “Annual Meeting”) will be held virtually on May 3, 2022, at 10:00 a.m. Eastern Time for the following purposes as set forth in the accompanying Proxy Statement:

Holders of record of our common and preferred stock at the close of business on March 14, 2022 will be entitled to vote at the meeting.

Due to the ongoing health and safety concerns related to the COVID-19 pandemic, this year’s Annual Meeting will be held in a virtual-only meeting format. To be admitted to the Annual Meeting, you will need to visit www.virtualshareholdermeeting.com/BMY2022 and enter the 16-digit control number included on your Important  Notice Regarding the Availability of Proxy Materials, on your proxy card, or on the instructions that accompanied your proxy materials. Guests may join the Annual Meeting in a listen-only mode, but they will not have the option to vote shares or ask questions during the virtual meeting. Once admitted, you may submit questions, vote or view our list of shareholders during the Annual Meeting by following the instructions that will be available on the meeting website. You may log into the meeting platform beginning at 9:50 a.m. Eastern Time on May 3, 2022. To submit a question before the meeting, visit www.proxyvote.com with your 16-digit control number and select the “Submit a Question for Management” option. To submit a question during the meeting, visit www.virtualshareholdermeeting.com/BMY2022, enter your 16-digit control number and type your question into the “Ask a Question” field and click “Submit.” The company will provide direct and specific information to shareholder proponents on how they can present their shareholder proposals during the meeting.

By Order of the Board of Directors

 

Kimberly M. Jablonski

 

Dear BMS shareholders,

2021 was a pivotal year for Bristol Myers Squibb. We advanced our strategy and renewed our portfolio to drive sustained, long-term growth, achieved significant milestones across our core therapeutic areas, and made important progress in delivering on our commitments to diversity, inclusion and health equity.

Amid the ongoing COVID-19 pandemic, this work is particularly notable and was enabled by our dedicated global workforce who never stopped working for our patients. Throughout the pandemic, we have prioritized the health and safety of our global workforce and communities, supported research and relief efforts around the world, and remained united in carrying out our mission to discover, develop and deliver transformational medicines.

Last year, we achieved:

We have a strong business today, and are well positioned to deliver sustained growth through the decade. We are executing our plan to drive sustained growth through the launch of 9 new medicines which, combined with a rapidly advancing mid- and late-stage pipeline, have the potential to offset upcoming losses of exclusivity for certain key brands. During 2021, we progressed six new product launches, and achieved significant regulatory milestones for next generation therapies, including regulatory filings for the relatlimab and nivolumab fixed dose combination for metastatic melanoma (U.S.), mavacamten for obstructive hypertrophic cardiomyopathy (U.S.) and deucravacitinib for moderate to severe plaque psoriasis (U.S., EU, Japan), all of which we are preparing to launch in 2022. In addition, we have a strong mid- to late-stage pipeline, strong cash flow and a balanced capital allocation strategy to provide the Company with the flexibility to deliver value and build for the future.

We are taking bold, intentional action to do our part to ensure that healthcare works for everyone. I am proud of our progress in building a truly inclusive culture. Our diverse workforce reflects our communities and our global patient population and is enabling our company to deliver innovation and more equitable care. Last year, we issued our first Diversity and Inclusion Report, highlighting our goals and progress. At the same time, we are doing our part to address inequities in our healthcare system. We are integrating a commitment to health equity throughout our business, which we believe will lead to better science and patient outcomes, and we are delivering on our responsibility to the communities we serve. To this end, the Company and the BMS Foundation made important progress towards the commitments announced in 2020 to each donate $150 million to cover five bold areas: addressing health disparities, increasing clinical trial diversity, expanding our supplier diversity, enhancing our employee giving, and increasing our workforce diversity. Our work in 2021 included: partnering with Historically Black Colleges and Universities to build a sustainable bridge for diverse talent to the biopharma industry, donating to 56 non-profits serving medically underserved populations in the U.S., and progressing our plans to locate 25 percent of our U.S. clinical research sites in highly diverse communities beginning in 2022. Separately, the BMS Foundation selected 52 physicians to begin training in its Diversity in Clinical Trials Career Development Program in partnership with the National Medical Fellowships. For further discussion on these commitments and the progress we are making, please see discussion under “Commitment to Diversity & Inclusion” beginning on page 37.

As we look forward to 2022 and beyond, I am confident in our ability to grow as a company while delivering transformational science, grounded in our patient-centric culture and powered by a diverse team of over 30,000 global employees.

We ask that you review this report and offer your support for our directors and other items we have put forth in this Proxy Statement. We welcome your feedback, participation in our annual meeting and your future investment.

Thank you for your continued support of our mission. We hope you and your loved ones continue to stay safe and healthy.

Sincerely,

 

Giovanni Caforio, M.D.

Board Chair and Chief Executive Officer

Oversight of the Company’s Strategy. The Board remains committed to oversight of the company’s strategy, including management’s execution of our strategy to create long-term shareholder value. In 2021, our proactive partnership with and independent oversight of management was a top priority. The Board met 9 times during 2021 to discuss, among other things, the strategic direction of the company, our key enterprise risks and our progress against significant milestones, which enables us to deliver on our promise to renew our product pipeline with new life-changing medicines. In addition, we recognize that our environmental, social and governance (“ESG”) strategy must remain fully aligned to our corporate strategy so we can focus on our critical risks and opportunities. In 2021, we published our first ESG Report. For further discussion on our ESG strategy, please see “Environmental, Social, Governance & Sustainability” beginning on page 18.

Enhanced Board Effectiveness and Composition. As we move into another important chapter for Bristol Myers Squibb, we understand clearly how important it is to have a high functioning board with highly qualified members with diverse backgrounds and the right skill sets to advance the company’s mission. To that end, I am delighted to report that 6 out of 10 of our directors are diverse by gender, race, or ethnicity (three of whom are diverse by race/ethnicity and four by gender). We are committed to balanced refreshment of our Board and over the last two years have added three new directors, expanding the depth of experience in the areas of finance, strategic leadership, science and industry knowledge. We are excited about our newest director, Manuel Hidalgo Medina, M.D., Ph.D. who brings significant scientific expertise to the Board, with a particular emphasis on translational and clinical research in cancer drug development. Together our Board possesses the diverse skills and experiences most relevant to our future. In addition, as Lead Independent Director, I will continue to promote a Board culture of respect and open dialogue, where all directors add input and decisions are thoroughly discussed, debated and evaluated prior to any Board action. For further discussion on board composition, see “2022 Director Nominees,” beginning on page 4.

Effective Engagement with our Shareholders. Constructive engagement with our shareholders is among our highest priorities. Input from our shareholders has shaped some of our governance practices. For example, in response to feedback, at the 2021 Annual Meeting, we included a proposal to reduce the ownership threshold for shareholders to call a special meeting from 25% to 15%. This proposal received strong vote support from shareholders and resulted in our adoption of this change. We acknowledge, however, that some shareholders have expressed differing views about our Board leadership structure and we respect those opinions. The Board considers this topic each year and I can assure you that our Board adheres to good governance practices that support our independent oversight of management. As Lead Independent Director, I have well-defined responsibilities and am empowered to provide strong leadership of the independent directors, including as it relates to maintaining our strong board culture, reviewing and approving meeting agendas, and regularly meeting with the independent directors in executive session without the Board Chair as well as during one-on-one discussions throughout the year. On balance, we believe shareholder interests are best served when the Board has the flexibility to determine the most appropriate leadership structure based on an assessment of the company’s needs and circumstances at any given time.

I encourage you to read the following pages to inform your vote and ask for your support for the items our company has put forth in this Proxy Statement. On behalf of the Board, we thank you for your continued support.

 

Theodore R. Samuels

Lead Independent Director

Chair, Committee on Directors and Corporate Governance

 

Our Board of Directors (the “Board”) has nominated 10 current directors, Peter J. Arduini, Giovanni Caforio, M.D., Julia A. Haller, M.D., Manuel Hidalgo Medina, M.D., Ph.D., Paula A. Price, Derica W. Rice, Theodore R. Samuels, Gerald L. Storch, Karen H. Vousden, Ph.D., and Phyllis R. Yale, to serve as directors of Bristol Myers Squibb. The directors will hold office from election until the 2023 Annual Meeting or until their successors are duly elected. We believe that tone is set at the top, so we begin this section on our Board by introducing you to who we are. We follow that with sections on how we are selected and elected, how we govern and are governed, how we are organized, how you can communicate with us and how we are paid. We ask in Item 1 for your voting support so we can continue our important work and build on our significant successes in 2022.

 

All Director Nominees Possess:

 

Our executives and employees put a great deal of thought into talent recruitment and retention, and we at the Board level are similarly committed to identifying and attracting the best directors for our company. In the subsections that follow we describe our standards, policies and processes to achieving this goal.

A majority of the votes cast is required to elect directors. Any current director who does not receive a majority of votes cast must tender their resignation as a director within 10 business days after the certification of the shareholder vote. The Committee on Directors and Corporate Governance, without participation by any director tendering their resignation, will consider the resignation offer and recommend to the Board whether to accept it. The Board, without participation by any director tendering their resignation, will act on the Committee’s recommendation at its next regularly scheduled meeting to be held within 60 days after the certification of the shareholder vote. We will promptly disclose the Board’s decision and the reasons for that decision in a broadly disseminated press release that will also be furnished to the U.S. Securities and Exchange Commission (SEC) on Form 8-K. If any nominee is unable to serve, proxies will be voted in favor of the remainder of those nominated and may be voted for substitute nominees, unless our Board of Directors provides for a lesser number of directors.

As specified in our Corporate Governance Guidelines, members of our Board should be persons with broad experience in areas important to the operation and long-term success of our company. These include areas such as business, science, medicine, finance/accounting, law, business strategy, crisis management, corporate governance, education or government. Board members should possess qualities reflecting integrity, independence, leadership, good business judgment, wisdom, an inquiring mind, vision, a proven record of accomplishment and an ability to work well with others. The Corporate Governance Guidelines also express the Board’s belief that its membership should continue to reflect a diversity of gender, race, ethnicity, age, sexual orientation and gender identity.

Our Corporate Governance Guidelines provide that a substantial majority of Board members be independent from management, and the Board has adopted independence standards that meet the listing standards of the New York Stock Exchange. Our Board has determined that, except for Giovanni Caforio, M.D., who is our Chief Executive Officer, each of our directors and each director nominee for election at this Annual Meeting is independent of Bristol Myers Squibb and its management.

In accordance with our Corporate Governance Guidelines, our Board undertakes an annual review of director independence. In February 2022, the Board considered all commercial and charitable relationships of our independent directors and director nominees, including the following relationship, which was deemed immaterial under our categorical standards (see Exhibit A):

The Board determined that none of our independent directors had any relationships that would impair their independence under the New York Stock Exchange’s independence standards or otherwise.

The Committee on Directors and Corporate Governance regularly assesses the appropriate size and composition of our Board. This assessment incorporates the results of the Board’s annual evaluation process, which are described more fully under “Annual Evaluation Process” beginning on page 13. The Committee also considers succession planning for its directors.

In connection with the Board’s ongoing director identification process, the Committee on Directors and Corporate Governance, in consultation with the Board Chair, conducts an initial evaluation of prospective nominees against the established Board membership criteria discussed above. The Committee also reviews the skills of the current directors and compares them to the particular skills of potential candidates, keeping in mind the Board’s commitment to maintain members of diverse experience and background. In particular, the Board is committed to identifying and evaluating highly qualified women and underrepresented ethnic group candidates as well as candidates with other diverse backgrounds, industry experience and other unique characteristics.

directors, as applicable. After completing this evaluation and interview process, the Committee on Directors and Corporate Governance makes a recommendation to the full Board as to the persons who should be nominated by our Board, and the full Board determines the nominees after considering the recommendation and any additional information it may deem appropriate. Following a robust process that began in 2020, Dr. Hidalgo Medina was elected to join the Board, effective June 1, 2021. He was identified as a potential candidate for election to our Board by a third-party search firm retained by the Committee on Directors and Corporate Governance and was subsequently interviewed by members of the Board.

The Committee on Directors and Corporate Governance considers and evaluates shareholder recommendations of nominees for election to our Board of Directors in the same manner as other director nominees. Shareholder recommendations must be accompanied by disclosure, including written information about the recommended nominee’s business experience and background with consent in writing signed by the recommended nominee that he or she is willing to be considered as a nominee and, if nominated and elected, he or she will serve as a director. Shareholders should send their written recommendations of nominees accompanied by the required documents to: Bristol-Myers Squibb Company, 430 East 29^th Street—14^th Floor, New York, New York 10016, Attention: Corporate Secretary.

The Board is very focused on Board composition and refreshment to ensure that your Board has the best mix of skill sets, proficiencies and perspectives to deal with the ever-changing business dynamics of the company and external environment. The Board is also committed to increasing diversity and inclusion, both at the Board level and across the company. In particular, the Board is committed to identifying and evaluating highly qualified women and under-represented ethnic group candidates as well as candidates with other diverse backgrounds, industry experience and other unique characteristics. Finally, the Board will continue to rely on our robust board assessment process to review and evaluate the performance and contributions of directors, which improves the overall effectiveness of the Board.

Following extensive engagement with our shareholders, our Board determined to adopt proxy access in 2016, permitting a shareholder or group of up to 20 shareholders holding at least 3% of our outstanding shares of common stock for at least three years to nominate a number of directors constituting the greater of two directors or 20% of the number of directors on our Board, as set forth in detail in our Bylaws. If you wish to propose any action pursuant to our proxy access bylaw provision, you must deliver a notice to BMS containing certain information set forth in our Bylaws, not less than 120 but not more than 150 days before the anniversary of the prior year’s filing of the proxy materials. For our 2023 Annual Meeting, we must receive this notice between October 25, 2022 and November 24, 2022. Shareholders should send their notices to: Bristol-Myers Squibb Company, 430 East 29th Street—14^th Floor, New York, New York 10016, Attention: Corporate Secretary.

In response to feedback received from the 2019 annual evaluation process, the Board formalized the existing process for individual director assessment as noted above, added new directors with necessary skills that enhance the composition of our Board and updated the Board’s review and approval processes for capital projects and business development transactions. In response to feedback received during the 2020 annual evaluation process, the Board updated the way in which executive sessions are conducted and added a new director to the Board, Dr. Hidalgo Medina, effective June 1, 2021.

Director education is an ongoing, year-round process, which begins when a director joins our Board. Upon joining our Board, new directors are provided with a comprehensive orientation program of our company, including our business, strategy and governance. New directors participate in an orientation program with senior business and functional leaders from all areas of the company, where strategic priorities and key risks and opportunities are discussed. All of our directors attend site visits to one or more of our locations. On an ongoing basis, our directors receive presentations on a variety of topics related to their work on the Board and within the biopharmaceutical industry, both from senior management and from experts outside of the company. We also encourage all of our directors to enroll in continuing education programs sponsored by third parties at our expense.

Our business is managed under the direction of our Board pursuant to the Delaware General Corporation Law and our Bylaws. The Board has responsibility for establishing broad corporate policies and for the overall performance of our company. The Board keeps itself informed of company business through regular written reports and analyses from management, and regular discussions with the Chief Executive Officer and other company officers; by reviewing other materials provided by management and by outside advisors; and by participating in Board and Board Committee meetings.

The Committee on Directors and Corporate Governance continually reviews corporate governance issues and is responsible for identifying and recommending the adoption of corporate governance initiatives. In addition, our Compensation and Management Development Committee regularly reviews our compensation policies and procedures and, when appropriate, recommends changes that strengthen our compensation practices. The “Compensation Discussion and Analysis” section beginning on page 34 discusses many of these policies and procedures.

The Board of Directors has adopted Corporate Governance Guidelines that govern its operation and that of its Committees. Our Board annually reviews the Corporate Governance Guidelines and, from time to time, revises them in response to changing regulatory requirements, evolving best practices and feedback from our shareholders and other constituents. Our Corporate Governance Guidelines may be viewed on our website at www.bms.com/ourcompany/governance.

Our Board meets regularly to discuss our company’s strategic direction and the issues and opportunities facing our company in light of trends and developments in the biopharmaceutical industry and the broader business environment. Our Board has been instrumental in determining our short-term and long-term company strategy.

For further discussion on how our Board administers its strategic planning and risk oversight function as a whole and through its Board Committees, please see the discussion under the header “How We Are Organized” beginning on page 22.

The Compensation and Management Development Committee annually conducts a worldwide review of our material compensation policies and practices. Based on this review, the Committee concluded that our material compensation policies and practices are not reasonably likely to have a material adverse effect on the company. On a global basis, our compensation policies and practices contain many design features that mitigate the likelihood of inducing excessive or inappropriate risk-taking behavior. These features include:

Our Board meets on a regularly scheduled basis during the year to review significant developments affecting Bristol Myers Squibb and to act on matters requiring Board approval. It also holds special meetings when important matters require Board action between scheduled meetings. Members of senior management regularly attend Board meetings to report on and discuss their areas of responsibility. The Board of Directors has been active during the COVID-19 pandemic, adapting like our global workforce, holding virtual and in-person board meetings as conditions permitted, and receiving regular updates from management as it navigates the many challenges presented by the pandemic. In 2021, the Board met 9 times. The average aggregate attendance of directors at Board and committee meetings was over 98%. No director attended fewer than 90% of the aggregate number of Board and committee meetings during the period he or she served. During these meetings, our independent directors met in executive sessions to discuss many topics, including the company’s integration of the Celgene and MyoKardia businesses and execution of our strategy to renew our product pipeline with new life-changing medicines, including executing on key launches to replace revenues from upcoming losses of exclusivity, among other things. The Board and Board Committees also held information sessions throughout 2021, which supplemented the regularly scheduled Board and Committee meetings. These information sessions were especially important during 2021 and allowed the Board to provide effective oversight and support to our management team during the ongoing pandemic. For 2022, the Board and Committees will continue to supplement their regular meetings with information sessions as needed.

It is the expectation of the Board that each director has sufficient time to attend, prepare for and participate during Board and Committee meetings. Our Committee on Directors and Corporate Governance periodically reviews the outside board service of our directors and has adopted internal procedures to address when a director’s outside public board service exceeds the limit included in the company’s Corporate Governance Guidelines.

Directors are strongly encouraged, but not required, to attend the Annual Meeting of Shareholders. All of the 2021 nominees for director who were directors as of the 2021 Annual Meeting attended our virtual 2021 Annual Meeting of Shareholders.

The Principles of Integrity adopted by our Board of Directors set forth important company policies and procedures in conducting our business in a legal, ethical and responsible manner. These standards are applicable to all of our employees, including the Chief Executive Officer, the Chief Financial Officer and the Controller.

In addition, the Audit Committee has adopted the Code of Ethics for Senior Financial Officers that supplements the Principles of Integrity by providing more specific requirements and guidance on certain topics. The Code of Ethics for Senior Financial Officers applies to the Chief Executive Officer, the Chief Financial Officer, the Controller, the Treasurer and the heads of major operating units.

Our Board has also adopted the Code of Business Conduct and Ethics for Directors that applies to all directors and sets forth guidance with respect to recognizing and handling areas of ethical issues.

The Principles of Integrity, the Code of Ethics for Senior Financial Officers and the Code of Business Conduct and Ethics for Directors are available on our website at www.bms.com/ourcompany/governance. We will post any substantive amendments to, or waivers from, applicable provisions of our Principles, our Code of Ethics for Senior Financial Officers, and our Code of Business Conduct and Ethics for Directors on our website at www.bms.com/ourcompany/governance within two days following the date of such amendment or waiver.

BlackRock, Inc. (BlackRock) and The Vanguard Group (Vanguard) are each considered a “Related Party” under our related party transaction policy because they each beneficially own more than 5% of our outstanding common stock. The Governance Committee approved the following related party transactions in accordance with our related party policy and procedures and Bylaws:

The Governance Committee approved the above relationships on the basis that these entities’ ownership of our stock plays no role in the business relationship between us and them, and that the engagement of each entity was on terms no more favorable to them than terms that would be available to unaffiliated third parties under the same or similar circumstances.

We provide semi-annual disclosure on our website at the link below of all political contributions to political committees, parties or candidates on both state and federal levels that are made by our employee political action committee, as well as annual disclosure of the portion of our dues or other payments made to trade associations to which we give $50,000 or more that can be attributed to lobbying expenditures. Please see the company's website at: https://www.bms.com/about-us/sustainability/economic-responsibility/political-contributions.html under “Political Contributions.”

At Bristol Myers Squibb, our vision is to transform the lives of patients through science. As a leading biopharma company, we understand our responsibility extends well beyond the discovery, development and delivery of innovative medicines that help patients prevail over serious diseases. We believe that driving long-term business value is at the heart of living our purpose—being leaders and difference-makers for generations to come.

This belief is reflected in our strong governance profile, which includes direct oversight of environmental, social and governance (“ESG”) risks, assessment and disclosure by our Committee on Directors and Corporate Governance. Oversight by this Committee strengthens our ability to operate with the highest levels of quality, integrity and ethics, the primary element of our ESG strategy.

Our ESG strategy builds on a legacy of comprehensive and global sustainability efforts, encompassing the products we make and how we make them, our facilities, our employees and our communities. We have been setting sustainability objectives and reporting on the results since the 1990s, when we first began reporting on environmental objectives. In 2021, after successfully achieving our Sustainability 2020 Goals across the areas of patients, people, supply chain and the environment, we published our inaugural ESG Report detailing our critical risks and opportunities, as well as progress against our targets to accelerate innovation, enhance patient access to medicines, be an employer of choice and reduce our environmental footprint. Our ESG strategy seeks to mobilize our combined capabilities and resources to positively impact the communities where we live, work and serve, with four focus areas:

Our ESG strategy is fully aligned with our corporate strategy and was defined based on a formal assessment of priority issues drawn from senior executives and a broad group of stakeholders with board oversight. Through active engagement with our shareholders and other key stakeholders, we completed the development of our next generation commitments. We will set approved science-based emissions reductions targets in alignment with the Science Based Target Initiative as a key step in the roadmap to delivering these environmental commitments.

Our Board remains actively engaged on these issues with direct oversight by our Committee on Directors and Corporate Governance. For more information and to provide feedback, please see the company’s website at https://www.bms.com/about-us/sustainability.html under “Sustainability.”

We firmly believe that prescription medicines are such a vital part of human healthcare that everyone who needs them should have access to them. We have been, and remain committed to facilitating access to our medicines, and to furthering our Mission to help patients prevail over serious diseases. We price our medicines based on a number of factors, including, among others, the value of scientific innovation for patients and society in the context of overall healthcare spend; economic factors impacting the healthcare systems’ capacity to provide appropriate, rapid and sustainable access to patients; and the necessity to sustain our R&D investment in innovative, high-quality medicines that address the unmet medical needs of patients with serious diseases and improve their life needs.

At Bristol Myers Squibb, we believe in the value our medicines bring to patients and society and our role in transforming care to help patients live longer, healthier and more productive lives. We focus on medicines that meaningfully change patient outcomes and improve quality of life, and over the last 30 years, we have made significant contributions in areas such as HIV, hepatitis, cardiovascular disease and, most recently, immuno-oncology. After our acquisition of Celgene, we are now moving to the next generation of treatment options, such as CAR T. We are pursuing medicines with transformational potential in diseases such as cancer, hematology, heart failure, fibrosis, multiple sclerosis, psoriasis and neuroscience. Many of our medicines are breakthroughs in innovation, truly differentiated medicines that have changed the standard of care and help patients live longer and healthier lives. For example, in melanoma, prior to the availability of immuno-oncology treatment options, 25% of patients diagnosed with metastatic melanoma survived one year. This increased to 74% with immuno-oncology therapies. Through Revlimid and Pomalyst, we transformed the treatment of multiple myeloma. Advances like these have transformed the treatment of certain cancers and changed survival expectations for patients. Collectively, we have delivered five (5) new products in the past four (4) years, including 21 major market approvals in 2021. These breakthrough medicines are possible because of our sustained investment in research and development. We have emerged as an industry leader in R&D investment, investing approximately, $6 billion, $11 billion and $11 billion annually for 2019, 2020, and 2021, respectively or approximately 24% of our revenue in 2021. Our goal is to ensure access to our currently approved medicines while continuing to fuel the development of medicines for the future.

We take a thoughtful approach to pricing our products and have internal processes and controls in place to ensure that pricing decisions are thoroughly and appropriately vetted with the highest levels of management prior to implementation. This process includes routine presentations to the Board on drug pricing strategies. In addition, on balance, over the last few years, our revenue growth has been primarily attributable to increased volume arising from increased demand for our products rather than price increases. We have and continue to disclose the average net selling price increase for our U.S. products in our annual report on Form 10-K and our quarterly reports on Form 10-Q. Our average net selling price increase for 2017, 2018 and 2019 for our legacy BMS products was approximately, 2%, 0% and 0%, respectively and for 2020 and 2021 for our combined company products (including Celgene) was approximately 1% and 2%, respectively. We believe we have the appropriate governance mechanisms and internal controls and processes in place to ensure that pricing decisions are made in line with our values and commitment.

Demonstrating our ongoing efforts to responsibly price our medicines while balancing investment in new innovation, we expect U.S. net prices across our portfolio to remain neutral in 2022. List price increases remain below inflation and apply to medicines with ongoing clinical research. Any patient having issues obtaining or affording a BMS medicine should visit our patient support website hub at https://www.bmsaccesssupport.bmscustomerconnect.com/patient.

In addition, the Compensation Management and Development Committee annually completes a thoughtful and rigorous evaluation of our executive compensation program to ensure that the program is aligned with our Mission and

In December, the company issued its 2021 Global Access Report that detailed Bristol Myers Squibb’s efforts and progress towards advancing access to healthcare and health equity globally through its own efforts and in partnership with other stakeholders. We invite you to view this report on our website at https://www.bms.com/assets/bms/us/en-us/pdf/global-access-report.pdf.

The company’s governance documents provide the Board with flexibility to select the appropriate leadership structure for the company. They establish well defined responsibilities with respect to the Board Chair and Lead Independent Director roles, including the requirement that the Board have a Lead Independent Director if the Board Chair is not an independent director. This information is set forth in more detail on our website at www.bms.com/ourcompany/governance.

Our Board has dedicated significant consideration to our leadership structure, particularly in connection with the election of Dr. Caforio as the Board Chair at the 2017 Annual Meeting. The Board evaluates our leadership structure annually. The Board’s most recent analysis of our leadership structure took into account many factors, including the specific needs of the Board and the company, the strong role of our Lead Independent Director, our Corporate Governance Guidelines (including our governance practices that provide for independent oversight of management), the integration of Celgene businesses into our company, the challenges specific to our company, and the best interests of our shareholders. After thoughtful and rigorous consideration, the Board determined that combining the Board Chair and Chief Executive Officer positions and electing Dr. Caforio as the Board Chair continues to be in the best interest of the company and our shareholders and is the best leadership for the company and its shareholders at this time. Specifically, our Board believes having Dr. Caforio serve in the combined role of Board Chair and Chief Executive Officer confers distinct advantages at this time, including:

The Board recognizes the importance of appointing a strong Lead Independent Director to maintain a counterbalancing structure to ensure that the Board functions in an appropriately independent manner. The Lead Independent Director is selected annually by the independent directors. The independent directors of the Board have elected Mr. Samuels to serve in that position.

The Lead Independent Director’s responsibilities include, among others:

The Board’s culture is open and promotes transparent dialogue and rigorous discussion. The Board deliberates on all major decisions with and without management present and effectively utilizes executive sessions under the leadership of the Lead Independent director to drive board alignment.

The Board believes this structure provides an effective, high-functioning Board, as well as appropriate safeguards and oversight. Our Board will continue to evaluate its leadership structure in light of changing circumstances and will do so on at least an annual basis and make changes at such times as it deems appropriate.

Our Board administers its strategic planning and risk oversight function as a whole and through its Board Committees. The following are examples of how our Board Committees are involved in this process:

Our Bylaws specifically provide for an Audit Committee, Compensation and Management Development Committee, and Committee on Directors and Corporate Governance, all of which are composed entirely of independent directors. Our Bylaws also authorize the establishment of additional committees of the Board and, under this authorization, our Board of Directors established the Science and Technology Committee. Our Board has appointed individuals from among its members to serve on these four standing committees and each committee operates under a written charter adopted by the Board, as amended from time to time. These charters are published on our website at http://bms.com/ourcompany/governance/Pages/board_committees_charters.aspx. Each of these Board Committees has the necessary resources and authority to discharge its responsibilities, including the authority to retain consultants or experts to advise the committee.

The table below indicates the current members of our standing Board Committees and the number of meetings held in 2021:

In addition, in 2021, the Integration Committee held its final meeting in February and was dissolved effective as of the 2021 Annual Meeting.

We, members of the Board of Directors, know that we must actively seek information from a wide variety of sources—and not just from individuals and entities that work for us—to do our jobs optimally. We therefore create multiple means to hear from shareholders, employees at all levels, patients, medical professionals, policy experts and others to inform our work.

You can communicate with us via many of these means. You can provide us comments on your proxy when you are voting. You can attend our annual meeting and ask questions. You can accept our invitations to engage or ask us for a meeting when that is of value to you. You can participate in our various Investor Relations functions which we listen to both directly and indirectly. You can write to us via mail or use any of our reporting functions such as so-called Whistle Blower hotlines. And, of course, we pay close attention to your voting and investment decisions as well.

Our Board has created a process for anyone to communicate directly with our Board, any committee of the Board, the non-employee directors of the Board collectively or any individual director, including our Board Chair and Lead Independent Director. Any interested party wishing to contact our Board may do so in writing by sending a letter to Bristol-Myers Squibb Company, 430 East 29th Street—14th Floor, New York, New York 10016, Attention: Corporate Secretary.

Any matter relating to our financial statements, accounting practices or internal controls should be addressed to the Chair of the Audit Committee. All other matters should be addressed to the Chair of the Governance Committee.

Our Corporate Secretary or her designee reviews all correspondence and forwards to the addressee all correspondence determined to be appropriate for delivery. Our Corporate Secretary periodically forwards to the Governance Committee a summary of all correspondence received. Directors may at any time review a log of the correspondence we receive that is addressed to members of the Board as well as copies of any such correspondence. Our process for handling communications to our Board has been approved by the independent directors.

We continued to place a high priority on our proactive engagement with our shareholders in 2021, reaching out to over 50 of our top shareholders, representing approximately 49% of our shares outstanding. In 2021, management and members of the Board, including our Lead Independent Director, met with many of our shareholders and had a productive dialogue on a number of topics, including board composition and leadership, company strategy and execution, diversity and inclusion, environmental, social and governance (ESG) strategy and risk oversight, executive compensation as well as the company’s ongoing response to COVID-19.

The feedback received was generally positive and was shared with the entire Board and members of senior management. In addition, in 2022, we continued to engage with shareholders, seeking active feedback and offering additional insights on current topics of interest, such as our Board leadership structure, diversity and inclusion, our ESG strategy and the ongoing response to COVID-19, as well as executive compensation and corporate governance topics, including the shareholder proposals included in our 2021 Proxy Statement.

We aim to provide a competitive compensation program to attract and retain high quality directors. The Committee on Directors and Corporate Governance (when used in this Compensation of Directors’ section, the “Committee”) annually reviews our directors’ compensation program, including a review of the director compensation programs at our executive compensation peer groups. For 2021 planning, we again engaged an outside consultant, Frederic W. Cook & Co., Inc. (“FWC”), to review market data and competitive information on director compensation. FWC recommended, and the Committee determined, that our executive compensation peer groups should be the primary source for determining director compensation.

Upon reviewing FWC’s analysis in December 2020, the Committee determined to make no changes to the director compensation program for service as a director in 2021. As a result, our 2021 director compensation program was identical to our program in 2020. Giovanni Caforio, M.D. does not receive any additional compensation for serving as a director.

The Committee believes the total compensation package for directors we offered in 2021 was reasonable, and appropriately aligned the interests of directors with the interests of our shareholders by ensuring directors have an equity stake in our company.

In 2021, non-employee directors who served for the entirety of 2021 received:

On February 1, 2021, all non-employee directors serving on the Board at that time received an annual award of deferred share units valued at $190,000 under the 1987 Deferred Compensation Plan for Non-Employee Directors. These deferred share units are non-forfeitable at grant and are settleable solely in shares of our common stock. A new member of the Board who is eligible to participate in the Plan receives, on the date the director joins the Board, a pro-rata number of deferred share units based on the number of share units payable to participants as of the prior February 1.

As we entered a new chapter at Bristol Myers Squib in 2021, the health and safety of our workforce and the continued supply of our medicines to patients were our highest priorities. For a second year in a row, we were met with considerable challenges as the Board, senior management and our larger workforce navigated a dynamic and evolving pandemic environment as new COVID-19 variants emerged. Despite these challenges, our workforce remained resolute. We delivered strong operational and commercial performance while ensuring our patients continued to receive life-saving medicines. I am incredibly proud of the sustained resilience, dedication and agility of our workforce that continued to prioritize and deliver on our vision to transform patients’ lives through science.

The Compensation and Management Development Committee (when used in this Compensation Discussion & Analysis (“CD&A”), the “Committee” or “CMDC”) is deeply involved in ensuring that the executive compensation programs align, support and reinforce the company’s business and people strategy. For our Named Executive Officers (or “NEOs”), our goal each year is to create an executive compensation framework that provides clear lines-of-sight into the key drivers that we believe will create long-term value for our shareholders and patients.

From an executive compensation and human capital management perspective, we had four distinct focus areas over the past year and these will continue to guide us in our work in 2022. As you read our CD&A, you will see these distinct focus areas reflected throughout. They are:

We are at an important inflection point for our Company and the upcoming decade will be critical as we look to renew our pipeline and launch new medicines to replace maturing brands. To accomplish this, the Committee understands it is important to attract key talent, ensure the full engagement of our workforce and prepare for seamless and timely succession. To that end, our Committee also focuses on the development mandate outlined in our charter. In this regard, the Committee continued its longstanding practice of reviewing with the CEO the performance, potential and development opportunities for the senior executives who make up the leadership team, with a view toward prudent succession planning. As part of this effort, members of the Committee were involved in the interviews and onboarding of key external candidates who joined the BMS leadership team.

Over the past few years, shareholder feedback has helped to shape the development and refinement of our compensation program. During 2021, we continued this constructive dialogue, engaging with a large number of our shareholders on a variety of topics, including executive compensation, the incorporation of ESG priorities in our incentive programs, and human capital management, including remote work and protecting the health and safety of our workforce during the global pandemic. All feedback was thoroughly reviewed and discussed during our Committee and Board meetings.

We will continue to engage with shareholders and give full consideration to their feedback. We welcome your input.

 

Gerald L. Storch, Chair

2021 was another challenging year for our company and employees, as we continued to navigate the challenges of the ongoing COVID-19 pandemic and other related issues, such as supply chain constraints, inflation and a tightening labor market. Despite the challenges, we prioritized the health and safety of our workforce and delivered strong results.

Critical to our performance in 2021, and the future of our company, was our continued focus on growth and innovation: bringing truly transformational medicines to patients. Working together, we delivered strong operational and financial results, launched new products and achieved key integration milestones ahead of schedule. In addition, we achieved significant regulatory and clinical milestones that have strongly positioned the company to successfully renew our therapeutic portfolio and sustain growth over the long-term.

Our integration achievements from the Celgene transaction (which are well ahead of schedule) have established a strong foundation for Bristol Myers Squibb as a biopharma leader with a bright future ahead. Our strategy to focus on transformational innovation has demonstrated success. For example, we are launching 9 new medicines, 6 of which have already launched with 3 expected to launch during 2022. We have established leadership positions across oncology, hematology, cardiovascular, and immunology. In each of these businesses, we have leading in-line medicines, significant short-term launch opportunities and a rich pipeline, with platforms and technologies that provide significant opportunities for new approaches to the treatment of serious diseases. Our financial strength and flexibility, along with our differentiated business development strategy, will allow us to drive long-term value.

Looking ahead, we are very excited about where we are as a company. We are well positioned for growth and we are confident in our ability to deliver long-term sustainable value. We will remain focused on our key priorities and believe we will be able to demonstrate the strength of our continuing business, despite the challenges of losses of exclusivity for some of our key medicines like Revlimid. Business development remains a top priority to complement our portfolio for long-term growth and this was evident in 2021. We entered into many promising business development transactions, including with Eisai, Agenus and Immatics, further strengthening our oncology and cell therapy franchises. Together, these transactions demonstrate our commitment to leverage creative deal-making to accelerate innovation and create value for our shareholders.

Finally, we took key steps in 2021 to advance the commitments we announced in August 2020 around health equity, diversity and inclusion. For further discussion on these commitments, please see discussion under “Commitment to Diversity & Inclusion” beginning on page 37.

Following the completion of the Celgene transaction in November 2019, we started to harmonize and align our pay and benefits programs. For the 2020 performance year, the Committee took the initial step to ensure all eligible employees, including our NEOs, had similar performance goals in our annual bonus program and long-term incentive awards to reflect a holistic assessment of the company's and management's overall performance. Effective January 2021, we fully aligned enterprise-level compensation programs―namely our annual bonus and long-term incentive program―for all eligible employees, including our NEOs. For the annual bonus program, this included continuation of Key Integration Metrics for our executives. We also unified the benefits and work life offerings for employees in the U.S and Puerto Rico.

2021 was a year of strong execution for the company. We made great progress against the execution of our strategy, delivering strong operational and financial performance in key areas, including continued growth across our in-line portfolio, successful execution of new launches, and achievement of significant pipeline milestones. We accomplished this while navigating the challenges of a global pandemic.