Bristol-Myers Squibb (BMY) seems to be a textbook case of the risks that big pharma investors face these days. Not only has its biggest drug gone over the patent cliff, but the company is facing some big headwinds because of research losses.

Bristol-Myers Squibb has admitted that it will have to take a $1.8 billion loss because of the failure of its Hepatitis C drug, BMS-986094. Testing on that drug was halted last month after a patient died during drug trials. The loss of the hepatitis drug might lower Bristol-Myers Squibb's leveraged value because the Center for Disease Control estimates that as many as two million American baby boomers might be infected with the virus.

Even if this is a one time loss, it will affect Bristol-Myers Squibb's net income because the company's sales for the last year totaled $20.49 billion. Still, a company with a market capitalization of $55.46 billion will be able to take a $1.8 billion loss in stride. Mr. Market seems to disagree with this assessment if the chart below is anything to go on.

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