Bristol Myers Squibb (NYSE:BMY) on Tuesday announced positive results from a phase 3 trial of deucravacitinib in patients with moderate to severe plaque psoriasis. The drug, an oral tyrosine kinase 2 (TYK2) inhibitor, met primary endpoints versus placebo, and showed superiority to Otezla in multiple key secondary endpoints. Celgene sold Otezla to Amgen last year to clear the way for its acquisition by Bristol Myers Squibb.

Bristol Myers Squibb will release more detailed results from the study at a future medical conference, but said more patients achieved a 75% improvement on the Psoriasis Area and Severity Index and a static Physicians Global Assessment score of clear or almost clear after 16 weeks of treatment with the drug than did those in the placebo group. Some secondary endpoints were also met, including superiority to Otezla. There were 666 patients in the study.

Dollar signs spilling out of a pill.

Image source: Getty Images.

Bristol Myers Squibb and Celgene divested Otezla to Amgen for the massive price of $13.4 billion in order to alleviate the Federal Trade Commission's concerns about their merger, and the deal is paying off for Amgen. Otezla is approved for plaque psoriasis and psoriatic arthritis, and is selling at an annual rate of over $2 billion with double-digit growth.

It'll be a while before deucravacitinib starts cutting into Otezla's sales, assuming it's approved, but Bristol Myers Squibb could be filling the gap in its immunology lineup with a superior drug. The pharmaceutical giant has deucravacitinib in phase 2 trials for treating psoriatic arthritis, lupus nephritis, systemic lupus erythematosus, Crohn's disease, and ulcerative colitis.

Editor's note: This article has been updated.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.