SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of

the Securities Exchange Act of 1934 (Amendment No.      )

Filed by the Registrant    x

Filed by a Party other than the Registrant¨

Check the appropriate box:

Bristol-Myers Squibb Company

(Name of Registrant as Specified In Its Charter)

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

Payment of Filing Fee (Check the appropriate box):

March 23, 200522, 2006

345 Park Avenue

New York, New York 10154-0037

NOTICE OF ANNUAL MEETING

OF STOCKHOLDERS

Notice is hereby given that the Annual Meeting of Stockholders will be held at the Hotel duPont, 11th and Market Streets, Wilmington, Delaware, on Tuesday, May 3, 20052, 2006 at 9:4510:00 a.m. for the following purposes as set forth in the accompanying Proxy Statement:

to approve the company’s Restated Certificate of Incorporation effecting an amendment to eliminate certain supermajority vote requirements;

Holders of record of our company’s common and preferred stock at the close of business on March 7, 2005,6, 2006, will be entitled to vote at the meeting.

By Order of the Board of Directors

SANDRA LEUNG

Secretary

Dated: March 23, 200522, 2006

YOUR VOTE IS IMPORTANT

Regardless of the number of shares you own, your vote is important.

If you do not attend the Annual Meeting to vote in person, your vote will not be counted unless a proxy representing your shares is presented at the meeting.

To ensure that your shares will be voted at the meeting, please vote in one of these ways:

OR

OR

If you do attend the Annual Meeting, you may revoke your proxy and vote by ballot.

ELECTRONIC DELIVERY OF PROXY STATEMENT AND ANNUAL REPORT

This Proxy Statement and the 20042005 Annual Report are available on Bristol-Myers Squibb’s Internet site at www.bms.com. Most stockholders can elect to view future proxy statements and annual reports over the Internet instead of receiving paper copies in the mail.

If you are a stockholder of record, you can choose this option and save Bristol-Myers Squibb the cost of production and mailing these documents by following the instructions provided when you vote over the Internet. If you hold your Bristol-Myers Squibb stock through a bank, broker or other holder of record, please refer to the information provided by that entity for instructions on how to elect to view future proxy statements and annual reports over the Internet.

If you choose to view future proxy statements and annual reports over the Internet, you will receive an e-mail message next year containing the Internet address to access Bristol-Myers Squibb’s proxy statement and annual report. Your choice will remain in effect until you tell us otherwise. You do not have to elect Internet access each year. To view, cancel or change your enrollment profile, please go to www.InvestorDelivery.com.

PROXY STATEMENT

TABLE OF CONTENTS

GENERAL INFORMATION ABOUT THE ANNUAL MEETING AND VOTING

Why am I receiving these materials?

This Proxy Statement is being sent to all stockholders of record as of the close of business on March 7, 20056, 2006 for delivery beginning March 23, 200522, 2006 in connection with the solicitation of proxies on behalf of the Board of Directors for use at the Annual Meeting of Stockholders on May 3, 2005.2, 2006. Although the Annual Report and Proxy Statement are being mailed together, the Annual Report should not be deemed to be part of the Proxy Statement.

Who can attend the Annual Meeting?

Only stockholders of Bristol-Myers Squibb as of the record date, March 7, 2005,6, 2006, their authorized representatives and guests of Bristol-Myers Squibb may attend the Annual Meeting. Admission will be by ticket only. In addition, please be sure to bring photo identification. The Hotel duPont is accessible to disabled persons and, upon request, wireless headsets for hearing amplification will be provided.

How do I receive an admission ticket?

If you are a registered stockholder (your shares are held in your name) and plan to attend the meeting, your Annual Meeting admission ticket can be detached from the top portion of the proxy card.

If you are a beneficial owner (your shares are held in the name of a bank, broker or other holder of record) and plan to attend the meeting, you can obtain an admission ticket in advance by writing to Stockholder Services, Bristol-Myers Squibb Company, 345 Park Avenue, New York, New York 10154. Please be sure to enclose proof of ownership, such as a bank or brokerage account statement. Stockholders who do not obtain tickets in advance may obtain them upon verification of ownership at the Registration Desk on the day of the Annual Meeting.

Tickets may be issued to others at the discretion of the company.

Who is entitled to vote?

All holders of record of our company’s $0.10 par value common stock and $2.00 convertible preferred stock at the close of business on March 7, 20056, 2006 will be entitled to vote at the 20052006 Annual Meeting. Each share is entitled to one vote on each matter properly brought before the meeting.

How do I vote if I am a registered stockholder?

Proxies are solicited to give all stockholders who are entitled to vote on the matters that come before the meeting the opportunity to do so whether or not they attend the meeting in person. If you are a registered holder, you can vote your proxy in one of the following manners:

Choosing to vote via the Internet or calling the toll-free number listed on the proxy card will save the company expense. In order to vote online or via telephone, have the voting form in hand and either call the number or go to the website indicated on the enclosed form and follow the instructions. If you vote via the Internet or by telephone, please do not return a signed proxy card.

If you choose to vote by mail, mark your proxy card enclosed with the Proxy Statement, date and sign it, and mail it in the postage-paid envelope.

If you wish to vote in person, you can vote the proxy in person at the Annual Meeting.

How do I specify how I want my shares voted?

If you are a registered stockholder, you can specify how you want your shares voted on each proposal by marking the appropriate boxes on the proxy card. Please review the voting instructions on the proxy card and read the entire text of the proposals and the positions of the Board of Directors in the Proxy Statement prior to marking your vote.

If your proxy card is signed and returned without specifying a vote or an abstention on a proposal, it will be voted according to the recommendation of the Board of Directors on that proposal. That recommendation is shown for each proposal on the proxy card.

How do I vote if I am a beneficial stockholder?

If you are a beneficial stockholder, you have the right to direct your broker or nominee on how to vote the shares. You should complete a voting instruction card which your broker or nominee is obligated to provide you. If you wish to vote in person at the meeting, you must first obtain from the record holder a proxy issued in your name.

What items will be voted upon at the Annual Meeting?

At the Annual Meeting, the following items will be voted upon:

Our Board of Directors knows of no other matters that may be brought before the meeting. However, if any other matters are properly presented for action, it is the intention of the named proxies to vote on them according to their best judgment.

What are the Board of Directors’ voting recommendations?

For the reasons set forth in more detail later in the Proxy Statement, our Board of Directors recommends a vote FOR the election of directors, FOR the ratification of the appointment of PricewaterhouseCoopersDeloitte & Touche LLP as our independent registered public accounting firm for 2005, FOR approval of our Restated Certificate of Incorporation effecting an amendment to eliminate certain supermajority provisions2006 and AGAINST each of the sevenfive stockholder proposals.

How many votes are needed to have the proposals pass?

A plurality of the votes cast at the meeting is required to elect directors. Our Board of Directors adopted a corporate governance policy regarding director elections that is contained in our Corporate Governance Guidelines, which are attached to this Proxy Statement as Annex A. The affirmative votepolicy provides that in any uncontested election, any nominee for director who receives a greater number of at least 75%votes “withheld” for his or her election than votes “for” such election (a “majority withheld vote”) will tender his or her resignation as a director within 10 business days after the certification of the outstanding sharesstockholder vote. The Committee on Directors and Corporate Governance, without participation by any director so tendering his or her resignation, will consider the resignation offer and recommend to the Board whether to accept it. The Board, without participation by any director so tendering his or her 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 company is requiredstockholder vote. We will promptly disclose the Board’s decision and the reasons for the decision in a broadly disseminated press release that will also be furnished to approve the proposal to amend our

Restated Certificate of Incorporation to eliminate certain supermajority vote requirements. The affirmative vote of a majority of the shares present in person or by proxy is required for ratification of the appointment of an independent registered public accounting firm and for the adoption of each of the sevenfive stockholder proposals.

How are the votes counted?

In accordance with the laws of the state of Delaware and our Restated Certificate of Incorporation and Bylaws,

How canCan I revokechange my Proxy?vote after I return the proxy card, or after voting by telephone or electronically?

You mayIf you are a shareholder of record, you can revoke your proxy at any time before it is voted at the meeting by taking one of the following three actions:

If you are a beneficial owner of shares, you may submit new voting instructions by giving timely written noticecontacting your bank, broker or other holder of the revocation to the Secretary of Bristol-Myers Squibb; (ii) by executing and delivering a proxy with a later date; or (iii) by votingrecord. You may also vote in person at the meeting.Annual Meeting if you obtain a legal proxy.

All shares that have been properly voted and not revoked will be voted at the Annual Meeting.

How do I designate my proxy?

If you wish to give your proxy to someone other than the Directors’ Proxy Committee, you may do so by crossing out the names of all three Proxy Committee members appearing on the proxy card and inserting the name of another person. The signed card must be presented at the meeting by the person you have designated on the proxy card.

Who counts the votes?

Tabulation of proxies and the votes cast at the meeting is conducted by an independent agent and certified to by independent inspectors of election.

Is my vote confidential?

Yes, any information that identifies a stockholder or the particular vote of a stockholder is kept confidential.

Who will pay for the costs involved in the solicitation of proxies?

Bristol-Myers Squibb will pay all costs of preparing, assembling, printing and distributing the proxy materials. Management has retained Georgeson Shareholder Communications Inc. to assist in soliciting proxies for a fee of $25,000, plus reasonable out-of-pocket expenses. Our employees may solicit proxies on behalf of our Board of Directors through the mail, in person, and by telecommunications. We will, upon request, reimburse brokerage firms and others for their reasonable expenses incurred for forwarding solicitation material to beneficial owners of stock.

VOTING SECURITIES AND PRINCIPAL HOLDERS

At the close of business on March 7, 2005,6, 2006, there were 1,954,089,7341,963,662,514 shares of $0.10 par value common stock and 7,1896,419 shares of $2.00 convertible preferred stock outstanding and entitled to vote.

Common Stock Ownership by Directors and Executive Officers

The following table sets forth, as of February 15, 2005,2006, beneficial ownership of shares of our common stock by each director, each of the named executive officers and all directors and officers as a group. None of our directors and executive officers, individually or as a group, beneficially owns greater than 1% of the outstanding shares of common stock.

Unless otherwise noted, such shares are owned directly or indirectly with sole voting and investment power.

(e)	Includes 11,70812,271 shares owned by a family charitable foundation over which Mr. Dolan and his wife exercise shared voting and investment power. Mr. Dolan disclaims beneficial ownership of the shares owned by the family charitable foundation.

Principal Holders of Common Stock

The following table sets forth information regarding beneficial owners of more than 5 percent of the outstanding shares of our common stock.

Section 16(a) Beneficial Ownership Reporting Compliance

Under Section 16(a) of the Securities Exchange Act of 1934, our directors, executive officers and the beneficial holders of more than 10% of our Common Stockcommon stock are required to file reports of ownership and changes in ownership with the U.S. Securities and Exchange Commission. To the best of our knowledge, during 20042005 all applicable Section 16(a) filingsfiling requirements were met except that due to an administrative error, late Forms 4 were filed on July 6, 2004 for each of Robert E. Allen, Vance D. Coffman, Lewis B. Campbell, Laurie H. Glimcher, Louis V. Gerstner, Jr., James D. Robinson, III and Louis W. Sullivan disclosing that on June 30, 2004, each such director accrued deferred share units under the 1987 Deferred Compensation Plan for Non-Employee Directors.met.

CORPORATE GOVERNANCE AND BOARD MATTERS

Our business is managed under the direction of our Board of Directors pursuant to the Delaware General Corporation Law and our Bylaws. Our Board has responsibility for establishing broad corporate policies and for the overall performance of our company. It is not, however, involved in operating details on a day-to-day basis. Our Board is kept advised of the company’s business through regular written reports and analyses and discussions with the Chief Executive Officer and other officers of Bristol-Myers Squibb, by reviewing materials provided to them and by participating in Board and Board Committee meetings.

Corporate Governance

We maintain a corporate governance webpage at http://www.bms.com/aboutbms/corporategovernance/corporate_governance/data/.

Our Board of Directors adopted Corporate Governance Guidelines in 2002. From time to time, our Board revises the Corporate Governance Guidelines in response to changing regulatory requirements, evolving best practices, and the concerns of our stockholders and other constituents. The Corporate Governance Guidelines are attached to this Proxy Statement as Annex A and may be viewed on the company’s website at www.bms.com.

Consistent with these goals, the Committee on Directors and Corporate Governance and the Compensation and Management Development Committee have reviewed various corporate governance and executive compensation issues during the past year and made recommendations to our Board. Based on these recommendations, our Board of Directors adopted the following corporate governance initiatives.

These changes supplement the corporate governance initiatives previously approved by our Board of Directors which include:

Director Independence

These changes supplementIt is the corporate governance initiatives previously approved bypolicy of our Board that a substantial majority of Directors which include:

Board Independence

director independence. Our Board hasconsidered, any and all commercial and charitable relationships of directors, including transactions and relationships between each director or any member of his or her immediate family and Bristol-Myers Squibb and its subsidiaries. Following the review, our Board determined, by applying the categorical director independence standards contained in the Corporate Governance Guidelines which are attached to this Proxy Statement as Annex A, that each of our directors nominated for election at this Annual Meeting is independent of Bristol-Myers Squibb and director nominees, except Peter R. Dolan,its management in that none has noa direct or indirect material relationship with our company, (other thanexcept for Peter R. Dolan. Mr. Dolan is not considered an independent director because of his employment as a directorChief Executive Officer of our company) and is therefore independent. the company.

The independent directors are Robert E. Allen, Lewis B. Campbell, Vance D. Coffman, James M. Cornelius, Ellen V. Futter,Louis J. Freeh, Louis V. Gerstner, Jr., Laurie H. Glimcher, M.D., Leif Johansson, James D. Robinson III and Louis W. Sullivan, M.D. In addition, all members of the Audit Committee, the Compensation and Management Development Committee and the Committee on Directors and Corporate Governance satisfy the standards of independence applicable to members of such committees established under applicable law and the listing requirements of the New York Stock Exchange.

Meetings of our Board

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 an important matter requires Board action between scheduled meetings. Members of senior management regularly attend Board meetings to report on and discuss their areas of responsibility. In 2004,2005, the Board of Directors met thirteeneight times. The average aggregate attendance of directors at Board and Committee meetings was over 96%. No director attended fewer than 88% of the aggregate number of Board and Committee meetings during the periods he or she served.

Annual Meeting of Stockholders

Directors are not required, but are strongly encouraged to attend the Annual Meeting of Stockholders. In 2004, nine2005, all of tenthe Directors attended the Annual Meeting of Stockholders.

Committees of our Board

Our Bylaws specifically provide for an Audit Committee and an Executive Committee. Our Bylaws also authorize the establishment of additional committees of the Board and, under this authorization, our Board of Directors has established the Committee on Directors and Corporate Governance and the Compensation and Management Development Committee. Our Board has appointed individuals from among its members to serve on these four committees. With the exception of the Executive Committee, each Committee is composed entirely of independent directors and operates under a written charter adopted by the Board, as amended from time to time. These charters are published on the company’s website at www.bms.com and are attached to this Proxy Statement.

www.bms.com.

In 2004,2005, the committees of the Board held a total of 2019 meetings: the Audit Committee met twelveten times, the Compensation and Management Development Committee met five times, and the Committee on Directors and Corporate Governance met three times. Thetimes and the Executive Committee did not meet in 2004.

TheAs of the date of the Proxy Statement, the table below provides membership information forindicates the members of each Board committee.

In addition, James D. Robinson III serves as a member,ex-officio, of all Board committees, except the Executive Committee of which he is a member.

Audit Committee

The Audit Committee is appointed by and generally acts on behalf of our Board of Directors. The Audit Committee works closely with management as well as our independent registered public accounting firm. The Audit Committee is responsible primarily for overseeing and monitoring the quality of our accounting and auditing practices and is directly responsible for the appointment, compensation and oversight of our independent registered public accounting firm for the purpose of preparing or issuing audit reports and related work regarding our financial statements. The Audit Committee also assists our Board in fulfilling its responsibilities for general oversight of compliance with legal and regulatory requirements, the performance of our internal audit function and independent registered public accounting firm, and business risk assessment and business risk management. Other specific duties and responsibilities include: (i) meeting to review our disclosure controls and procedures, internal controls, periodic filings with the U.S. Securities and Exchange Commission (SEC), earnings releases and earnings guidance; (ii) producing the required audit committee annual report for inclusion in our proxy statement; and (iii) overseeing investigations into complaints concerning financial or accounting matters.

The Audit Committee has the resources and authority appropriate to discharge its responsibilities, including the authority to retain independent legal counsel, accounting or other consultants or experts to advise the Committee. The Committee may also use the services of the company’s legal counsel and other advisors to the company.

The report of the Audit Committee Report is contained on page 32.The charter of the Audit Committee is attached to this Proxy Statement as Annex B.

35.

Our Board of Directors has determined that James M. Cornelius qualifies as an “audit committee financial expert” based on the Board’s understanding of the applicable SEC rules. In addition, our Board of Directors has determined that each current and former chief executive officer presently serving on the Audit Committee may also qualify as audit committee financial experts. Our Board has also determined that each member of the Audit Committee is independent as defined by the applicable New York Stock Exchange rules.

rules and is financially literate.

Including service on our company’s Audit Committee, Mr. CorneliusDr. Sullivan currently serves on the audit committees of four publicly traded companies. Our Board of Directors has determined that

Mr. Cornelius’s Dr. Sullivan’s simultaneous service on these audit committees does not impair his ability to serve effectively on our company’s Audit Committee. In making this determination, our Board of Directors has considered that Mr. Cornelius will step downDr. Sullivan is retiring from one company’s audit committee within one year.

the Board of Directors at this Annual Meeting in accord with mandatory retirement provisions in our Corporate Governance Guidelines.

Compensation and Management Development Committee

The Compensation and Management Development Committee is responsible primarily for reviewing, approving and reporting to our Board on major compensation and benefits plans, policies and programs of the company; reviewing and evaluating the performance and approving the compensation of executive officers and certain senior management; and overseeing our management development programs, performance assessment of senior executives and succession planning. Other specific duties and responsibilities include: annually reviewing and approving corporate goals and objectives relevant to CEO compensation; evaluating the CEO’s performance in light of those goals and objectives, and recommending to our Board the CEO’s compensation levels based on this evaluation; and producing the required annual report on executive compensation for inclusion in our proxy statement.

The Compensation and Management Development Committee has the resources and authority appropriate to discharge its responsibilities, including the authority to retain consultants or experts to advise the Committee.

The report of the Compensation and Management Development Committee Report on Executive Compensation is contained on page 21.The charter of the Compensation and Management Development Committee is attached to this Proxy Statement as Annex C.

23.

Committee on Directors and Corporate Governance

The Committee on Directors and Corporate Governance is responsible primarily for identifying individuals qualified to become Board members; recommending that our Board select the director nominees for the next annual meeting of stockholders; and overseeing our Board’s annual evaluation of its performance. The Committee on Directors and Corporate Governance is also responsible for identifying best practices and developing and recommending to our Board a set of corporate governance guidelines applicable to the company and for periodically reviewing such guidelines. Other specific duties and responsibilities include: reviewing and recommending annually to our Board of Directors the compensation of non-employee directors; considering questions of potential conflicts of

interest of directors and senior management; defining specific categorical standards for director independence, considering matters of corporate social responsibility and matters of significance in areas related to corporate public affairs and our employees and stockholders.

The Committee on Directors and Corporate Governance has the resources and authority appropriate to discharge its responsibilities, including the sole authority to retain, set compensation for, and terminate a search firm to be used to identify director candidates. In addition, the Committee has authority to obtainseek advice and assistance from other experts or consultants to advise the Committee. The charter of the Committee on Directors and Corporate Governance is attached to this Proxy Statement as Annex D.

consultants.

Executive Committee

The Executive Committee is appointed by our Board of Directors and generally acts during the intervals between the meetings of the entire Board. The Executive Committee may exercise all of the

powers of the entire Board in the management of the business and affairs of Bristol-Myers Squibb, except for specific powers that are reserved for the entire Board as set forth in our Bylaws.

Director QualificationsCriteria for Board Membership

Our corporate governance guidelines contain Board membership criteria that apply to nominees for a position on our Board of Directors. Under these criteria, members of our Board should be persons of diverse backgrounds with broad experience in areas important to the operation of the company such as business, science, medicine, finance/accounting, law, education or government and should possess qualities reflecting integrity, independence, wisdom, an inquiring mind, vision, a proven record of accomplishment and ability to work with others. Each director must represent the interests of our stockholders.

Identification and Selection of Nominees for our Board

The Committee on Directors and Corporate Governance periodically assesses the appropriate size of our Board, and whether any vacancies on our Board are expected due to retirement or otherwise. In the event that vacancies are anticipated or otherwise arise, the Committee on Directors and Corporate Governance considers candidates for director. Candidates may come to the attention of the Committee on Directors and Corporate Governance through current Board members, professional search firms, management, stockholders or others. The Chair of the Committee on Directors and Corporate Governance, in consultation with the Chairman of the Board and Chief Executive Officer, conducts an initial evaluation of the prospective nominees against the established Board membership criteria discussed above. Additional information relevant to the qualifications of prospective nominees may be requested from third-party search firms, other directors, management or other sources. After this initial evaluation, prospective nominees may be interviewed by telephone or in person by the Chair of the Committee on Directors and Corporate Governance, the Chairman of the Board, Chief Executive Officer and other directors. After completing this evaluation and interview, 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.

In 2004, the Committee on Directors and Corporate Governance retained a third-party search firm to identify candidates for director. The third-party search firm2005, one of our outside counsel identified Mr. James M. Cornelius,Louis J. Freeh as a potential candidate for election to our Board of Directors, among other potential candidates. Mr. Allen, Mr. Dolan and Mr. DolanRobinson interviewed Mr. CorneliusFreeh and reported back to the Committee on Directors and Corporate Governance. The Committee on Directors and Corporate Governance then recommended Mr. CorneliusFreeh as a nominee for director to the full Board.

Stockholder Nominations for Director

The Committee on Directors and Corporate Governance considers stockholder recommendations of nominees for election to our Board of Directors if they are accompanied by a comprehensive written resume of the recommended nominee’s business experience and background and a 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. Stockholders should send their written recommendations of nominees accompanied by the aforesaid documents to the principal executive offices of the company addressed to: Bristol-Myers Squibb Company, 345 Park Avenue, New York, New York 10154, attention: Secretary.

Executive Sessions and Presiding Director

In 2004,2005, our independentnon-management directors met in Executive Session fournine times to discuss such topics as our independentnon-management directors determined, including the evaluation of the performance of the Chief

Executive Officer. Mr. Allen, as Chair of the Committee on Directors and Corporate Governance and Mr. James D. Robinson, as Chairman of the Board, presided over these sessions.

Communications with our Board of Directors

The Committee on Directors and Corporate Governance has created a process by which stockholdersan interested party may communicate directly with our independentnon-management directors. Any stockholderinterested party wishing to contact an independenta non-management director may do so in writing by sending a letter to:

[Name of Director]

c/o Secretary

Bristol-Myers Squibb Company

345 Park Avenue

New York, NY 10154

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 Committee on Directors and Corporate Governance. Our Corporate Secretary reviews all correspondence and regularly forwards to our Board a summary of all such correspondence and copies of all correspondence that, in the opinion of our Corporate Secretary, deals with the functions of our Board or its committees, or that our Corporate Secretary otherwise determines requires Board attention. Directors may at any time review a log of the correspondence we receive that is addressed to members of the Board and request copies of any such correspondence.

Codes of Conduct

Our Board of Directors has adopted the Standards of Business Conduct and Ethics that sets 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, chief financial officerChief Executive Officer, the Chief Financial Officer and controller.the Controller. In addition, the Audit Committee has adopted the Code of Ethics for Senior Financial Officers that supplements the Standards of Business Conduct and Ethics by providing more specific requirements and guidance on certain topics. The Code of Ethics for Senior Financial Officers applies to the chief executive officer,Chief Executive Officer, the chief financial officer,Chief Financial Officer, the controller,Controller, the treasurerTreasurer and the headsHeads of major businessoperating 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 Standards of Business Conduct

and Ethics, 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. We intend towill post any material amendments to, or waivers from, our Code of Ethics for Senior Financial Officers and Code of Business Conduct and Ethics for Directors on our website.website within two days following the date of such amendment or waiver.

Employees are required to report any conduct they believe in good faith to be an actual or apparent violation of our Codes of Conduct. In addition, as required under the Sarbanes-Oxley Act of 2002, the Audit Committee has established procedures to receive, retain and treat complaints received regarding accounting, internal accounting controls, or auditing matters and the confidential, anonymous submission by company employees of concerns regarding questionable accounting or auditing matters.

Availability of Corporate Governance Documents

Our Corporate Governance Guidelines (including the categorical standards of director independence), Board committee charters, Standards of Business Conduct and Ethics, Code of Ethics for Senior Financial Officers and Code of Business Conduct and Ethics for Directors are available on our corporate governance webpage at www.bms.com and are available to any stockholderinterested party who requests them by writing to: Secretary, Bristol-Myers Squibb Company, 345 Park Avenue, New York, New York 10154.

Compensation of Directors

In 2004,2005, our independentnon-management directors received an annual retainer of $45,000. We require that 25% of the retainer be deferred and credited to a deferred compensation account, the value of which is

determined by the value of our common stock, until certain ownership guidelines are attained. IndependentNon-management directors received an additional fee of $2,000 for attending each Board meeting, Board Committee meeting, and the Annual Meeting of Stockholders. In addition, the Chairs of the Audit Committee, the Compensation and Management Development Committee and the Committee on Directors and Corporate Governance received an annual fee of $10,000. The following table sets forth information regarding the cash retainer and meeting fees earned by our non-management directors in 2005.

An independent

James D. Robinson III was appointed as the non-executive Chairman of the Board effective June 12, 2005. In 2005, Mr. Robinson received $195,000 in retainer fees in addition to the regular director retainer of $45,000. We require that 25% of the retainer be deferred and credited to a deferred compensation account, the value of which is determined by the value of our common stock, until certain ownership guidelines are attained. Mr. Robinson also received a one-time award of 40,000 restricted stock units, settleable in cash in a lump sum or in a maximum of ten annual installments. The restricted stock units will vest in two equal installments on the date of the 2007 Annual Meeting and the date of the 2008 Annual Meeting.

A non-management director may elect to defer payment of all or part of the compensation received as a director under our company’s 1987 Deferred Compensation Plan for Non-Employee Directors. Deferred funds may be credited to a 3-month6-month United States Treasury bill equivalent fund, a fund based on the return on the company’s invested cash or a fund based on the return on our common stock or to two or three of the funds. Deferred portions are payable in a lump sum or in a maximum of ten annual installments. Payments under the Plan begin when a participant ceases to be a director or at a future date previously specified by the director.

All independentnon-management directors received an annual award of 2,000 deferred common share units, the value of which is determined by the value of our common stock. Our Retirement Plan for Non-Employee Directors was terminated in 1996. Benefits existing under the Plan were vested as of that time for all directors who had served on the Board as of that date. Under our 2000 Non-Employee Directors’ Stock Option Plan, each independentnon-management director received on the date of the 20042005 Annual Meeting, an option to purchase 2,500 shares of our common stock, provided the director was elected to the Board of Directors on the date of the Annual Meeting or had previously been elected to the Board of Directors for a term extending beyond such Annual Meeting. The price of the option was the fair market price of our common stock on the date the option was granted. Each option becomes exercisable in four equal installments commencing on the earlier of the first anniversary of the date of the grant or the date of the next Annual Meeting and continuing similarly for the three years thereafter. The options also become fully exercisable upon retirement from the Board after one year of service following the grant date. In 2004,2005, options for a total of 22,50025,000 shares were granted under the plan, consisting of options for 2,500 shares granted to each of the nine independent directors.

ten non-management directors serving at the time of the 2005 Annual Meeting.

The Directors’ Charitable Contribution Program is part of our overall program of charitable contributions in which all current directors participate. The Program is partially funded by life insurance policies purchased by our company on individual members and retired members of the Board of Directors. In 2004,2005, we paid a total of $61,454$17,670 in premiums on policies covering fivetwo current directors and certain retired directors. The policies provide for a $1 million death benefit for each director covered. Upon the death of a director, Bristol-Myers Squibb donates one-half of the $1 million benefit to one or more qualifying charitable organizations designated by the director. The remaining one-half of the benefit is contributed to the Bristol-Myers Squibb Foundation, Inc. for distribution according to the Foundation’s program for charitable contributions to medical research, health-related and community service organizations, educational institutions and education-related programs and cultural and civic activities. Individual directors derive no financial benefit from this program since the tax benefit of all charitable deductions relating to the contributions accrue solely to Bristol-Myers Squibb.

Each year the Committee on Directors and Corporate Governance reviews our directors’ compensation practices and compares them against the practices of our peer group companies and the largest U.S. companies in market capitalization. The Committee believes the total director compensation package we offer continues to be competitive with the compensation offered by other companies, and appropriately aligns the interests of directors to stockholders by ensuring directors have a proprietary stake in our company.

ITEM 1—ELECTION OF DIRECTORS

Our Board of Directors is currently divided into two classes. At the 2003 Annual Meeting, our stockholders voted to gradually declassify our Board of Directors, such that at the 2006 Annual Meeting all elected directors will serve for a one-year term. Our Board of Directors has nominated sevennine current directors, Robert E. Allen, Lewis B. Campbell, Vance D. Coffman, James M. Cornelius, Peter R. Dolan, Ellen V. Futter, Louis V. Gerstner, Jr.J. Freeh, Laurie H. Glimcher, M.D., Leif Johansson and Louis W. Sullivan, M.D.James D. Robinson III to serve as directors of Bristol-Myers Squibb for a one-year term expiring atSquibb. The directors will hold office from election until the 2006 Annual Meeting. After the election of seven directors at the Annual Meeting, the Board of Directors will be composed of eleven directors, including four continuing directors whose terms extend beyond the2007 Annual Meeting. 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.

A plurality of the votes cast is required to elect directors. Our Board of Directors, however, adopted a corporate governance policy providing that in any uncontested election, any nominee for director who receives a majority withheld vote will tender his or her resignation as a director within 10 business days after the certification of the stockholder vote. The Committee on Directors and Corporate Governance, without participation by any director so tendering his or her resignation, will consider the resignation offer and recommend to the Board whether to accept it. The Board, without participation by any director so tendering his or her 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 stockholder 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 Securities and Exchange Commission on Form 8-K.

Listed below is certain biographical information of each of the nominees for election followed by information for directors whose terms extend beyond this Annual Meeting, including his or her principal occupation and other business affiliations.

Nominees for Directors for a Term Expiring in 2006

Director since 2000		PETER R. DOLAN Chairman of the Board and Chief Executive Officer of our company. Mr. Dolan was elected Chairman of the Board in September 2001. He was elected President of our company in 2000 and Chief Executive Officer in May 2001. Mr. Dolan is a Director of the American Express Company, and is the 2005 Chairman Elect of the Pharmaceutical Research and Manufacturers Association (PhRMA). He is a member of the Board of the National Center on Addiction and Substance Abuse, the Steering Committee for C-Change, Board of Overseers for the Amos Tuck School of Business at Dartmouth, and the Board of Trustees at Tufts University. He is a member of The Business Council and The Business Roundtable. Board Committee: Executive Committee (Chair). Age 49.
Director since 1990		ELLEN V. FUTTER President of the American Museum of Natural History since 1993. President of Barnard College from 1981 to 1993. Ms. Futter is a Director of J.P. Morgan Chase & Co., American International Group, Inc., Consolidated Edison, Inc., and Memorial Sloan-Kettering Cancer Center as well as a Trustee of the American Museum of Natural History. She is a Member of the Council on Foreign Relations, a Fellow of the American Academy of Arts and Sciences and a Director of NYC & Company. Ms. Futter is also a Member of the Advisory Board of Yale School of Management. Board Committee: Committee on Directors and Corporate Governance. Age 55.
Director since 1989 Director of Squibb Corporation from 1986 to 1989		LOUIS V. GERSTNER, JR. Chairman of the Board of IBM Corporation from 1993 to 2002. He served as Chief Executive Officer of IBM from 1993 until March 2002. Mr. Gerstner has been Chairman of The Carlyle Group since January 2003. He is Vice Chairman of the Board of Memorial Sloan-Kettering Cancer Center, a Director of Bessemer Securities Corporation and Bessemer Securities Limited, the Council on Foreign Relations and a Member of the National Academy of Engineering and The Business Council. He is a Trustee of the American Museum of Natural History, a Fellow of the American Academy of Arts and Sciences and the America-China Forum. Board Committees: Committee on Directors and Corporate Governance and Executive Committee. Age 63.
Director since 1998		LEIF JOHANSSON President of AB Volvo, an automotive company and Chief Executive Officer of the Volvo Group since 1997. He is Chairman of the Board of ACEA, Commercial Vehicles as well as Director of The Confederation of Swedish Enterprise, Royal Swedish Academy of Engineering Sciences, the Association of Swedish Engineering Industries and the Association des Constructeurs Europeens d’ Automobiles. He is also a Member of the European Business Roundtable of Industrialists. Board Committees: Audit Committee and Committee on Directors and Corporate Governance. Age 53.

Director since 1993		LOUIS W. SULLIVAN, M.D. President of the Morehouse School of Medicine from 1981 to 1989 and from 1993 to 2002. From 1989 to 1993, Dr. Sullivan was Secretary of the United States Department of Health and Human Services. Dr. Sullivan is a Director of 3-M Corporation, Georgia-Pacific Corporation, CIGNA Corporation, United Therapeutics Corporation, Equifax Inc., BioSante Pharmaceuticals, Inhibitex, Inc., and Henry Schein, Inc. Dr. Sullivan has committed to reduce the number of public company boards on which he serves to six or fewer by the end of May 2006. He is a Founder and Chairman of Medical Education for South African Blacks, Inc. and a Trustee of Morehouse School of Medicine and Africare as well as a Director of the National Center on Addiction and Substance Abuse at Columbia University. Board Committees: Audit Committee and Compensation and Management Development Committee. Age 71.

Directors whose terms expire in 2006

Director since 1998		VANCE D. COFFMAN Retired Chairman and Chief Executive Officer of Lockheed Martin Corporation, a high technology aerospace and defense company. He is a Director of the 3M Company and Deere & Company. He is a Member of the President’s National Security Telecommunications Advisory Committee, the National Academy of Engineering and the Security Affairs Support Association as well as a Fellow in the American Institute of Aeronautics and Astronautics and the American Astronautical Society. Board Committees: Audit Committee (Chair) and Compensation and Management Development Committee. Age 61.
Director since 2005		JAMES M. CORNELIUS Effective November 15, 2005, James M. Cornelius became Chairman of the Board and Chief Executive Officer (interim) of Guidant Corporation, a U.S. cardiac and vascular medical device company, as the company is being acquired. Previously, Mr. Cornelius served as Chairman of the Board (Non-Executive) since 2000. From 1995 until 2000, Mr. Cornelius served as the Senior Executive and Chairman of Guidant Corporation. From 1983 to 1994, Mr. Cornelius was a Director, a member of the Executive Committee and Chief Financial Officer of Eli Lilly and Company. Mr. Cornelius is a Director of The Chubb Corporation, The DirecTV Group, Inc. and Given Imaging, Ltd. He is a Managing Partner at Twilight Ventures Partners and a Board member of Leerink Swann & Company and a member of The National Bank of Indianapolis. He serves as Board Trustee and Treasurer of the Indianapolis Museum of Art. Board Committees: Audit Committee and Compensation and Management Development Committee. Age 62.
Director since 2000		PETER R. DOLAN Chief Executive Officer of our company. Mr. Dolan also served as Chairman of the Board of the company from September 2001 to June 2005. Mr. Dolan was elected President of the company in 2000 and Chief Executive Officer in May 2001. He was Senior Vice President for Strategy and Organizational Effectiveness from 1998 to his election as President. Mr. Dolan is a Director of the American Express Company, and is the 2006 Chairman of the Pharmaceutical Research and Manufacturers Association (PhRMA). He is a member of the Board of the National Center on Addiction and Substance Abuse, the Steering Committee for C-Change, Board of Overseers for the Amos Tuck School of Business at Dartmouth, and the Board of Trustees at Tufts University. He is a member of The Business Council and The Business Roundtable. Board Committee: Executive Committee (Chair). Age 50.
Director since 2005		LOUIS J. FREEH Mr. Freeh served as Vice Chairman, General Counsel, Corporate Secretary and Ethics Officer to MBNA Corporation from 2001 until its acquisition by Bank of America in January 2006. He served as FBI Director from 1993 to 2001 and previously as a U.S. District Judge, Assistant U.S. Attorney and FBI Special Agent. Board Committees: Audit Committee and Committee on Directors and Corporate Governance. Age 56.

Director since 1997		LAURIE H. GLIMCHER, M.D.   Irene Heinz Given Professor of Immunology at the Harvard School of Public Health and Professor of Medicine at Harvard Medical School since 1991. Dr. Glimcher is a Director of Waters Corporation and NDCHealth Corporation. She is a Fellow of the American Academy of Arts and Sciences and a Membermember of the National Academy of Sciences and the Institutes of Medicine of the National Academy of Sciences and the Irvington Institute Fellowship Committee. Board Committees: Audit Committee and Committee on Directors and Corporate Governance. Age 53.54.

Director since 1998		LEIF JOHANSSON President of AB Volvo, an automotive company and Chief Executive Officer of The Volvo Group since 1997. He is Chairman of the Board of ACEA, Commercial Vehicles as well as Director of The Confederation of Swedish Enterprise, Royal Swedish Academy of Engineering Sciences, the Association of Swedish Engineering Industries and the Association des Constructeurs Europeens d’ Automobiles. He is also a member of the European Business Roundtable of Industrialists. Board Committees: Audit Committee and Committee on Directors and Corporate Governance. Age 54.
Director since 1976		JAMES D. ROBINSON III   Chairman of the Board of our company since June 2005. Co-founder and General Partner of RRE Ventures, a private information technology venture investment firm, since 1994. He has served as President and sole stockholder of J. D. Robinson, Inc., a strategic consulting company, since 1993. He previously served as Chairman and Chief Executive Officer of American Express Company, a financial services company, from 1977 to 1993. Mr. Robinson is a Director of Novell, Inc., The Coca-Cola Company and First Data Corporation. Mr. Robinson is a Membermember of The Business Council, the Council on Foreign Relations and the Committee for Economic Development. He is Honorary Chairman of Memorial Sloan-Kettering Cancer Center and an Honorary Trustee of The Brookings Institution. Board Committees: Compensation and Management Development Committee (Chair), Committee on Directors and Corporate Governance and Executive Committee. Age 69.70.

COMPENSATION AND BENEFITS

Our compensation and benefits programs are designed to enable us to attract, retain and motivate the best possible employees to operate and manage our company at all levels.

We seek an executive compensation policy that is appropriately transparent to our stockholders and in alignment with our stockholders’ best interests.

In general, all U.S.-based employees receive a base salary, participate in an annual incentive plan, a company-supported savings plan and a company-funded pension plan and are provided with medical and other welfare benefits coverage. Employees outside of the U.S. are similarly covered by comprehensive compensation and benefits programs that are consistent with applicable local laws and regulations.

In addition, we maintain specific executive compensation programs designed to provide incentives to reward and retain outstanding executives who bear the responsibility for achieving the challenging business objectives necessary to assure our growth position in the highly complex and competitive pharmaceutical and healthcare industries in which we operate. Our executive compensation programs are based upon a pay-for-performance philosophy to provide incentives to achieve both short-term and long-term objectives and to reward exceptional performance, gains in productivity and contributions to our growth and success.

In addition to performance against financial operational and strategicoperational objectives and total stockholder return, which are the key determinants of incentive payments under our executive compensation programs, the successful Bristol-Myers Squibb (BMS) executive must also perform effectively in many areas that are not measured specifically by financial or operational results. Performance is also assessed against our Standards of Business Conduct and Ethics reflecting social values, environmental stewardship and the expectations of our key constituencies, including our employees and stockholders, the consumers of our products, suppliers and customers, the communities in which we operate and the countries where we do business. Executives must fully meet our Standards of Business Conduct and Ethics as a prerequisite to receiving any incentive payments. The Bristol-Myers Squibb Pledge (Pledge) and Core BMS Behaviors clearly definesdefine the values and behaviors that are expected of each of our employees, and the performance of our executives is appraised in this regard. Executives are evaluated pursuant to the company’s performance management system whereby executives are given two ratings, one for results and one for behaviors. The results rating represents the executive’s performance against specific financial and operational goals that are established at the beginning of the year and are consistent with our strategy. The behaviors rating measures how well the executive demonstrates the coreCore BMS behaviorsBehaviors consistent with our company’s Mission and Pledge. These ratings are key factors in determining the size of an executive’s merit increase, bonus and equity awards.

Executive Officer Compensation

The following tables and notes present the compensation provided to Mr. Peter R. Dolan, Chairman and Chief Executive Officer, as well as the fivefour other most highly compensated executive officers and an additional highly compensated executive who was not an executive officer as of December 31, 2005, for services rendered to our company in 2002, 2003, 2004 and 2004.

2005. Mr. Hayden’s employment with the company terminated on March 2, 2006 and Mr. McGoldrick will retire from the company on April 1, 2006.

Summary Compensation Table

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For 2004, other2005, Other Annual Compensation for the named executive officers was in the form of perquisites. Perquisites, including personal air travel, are calculated based on the aggregate incremental cost to the company of providing the benefit. (For personal air travel this includes costs for fuel, maintenance labor and parts, engine reserve, APU overhaul, landing and parking fees, crew expenses, supplies and catering, including costs incurred for deadhead flights.) For 2004,2005, these perquisites included the following: Mr. Dolan ($76,625144,879 for personal use of company aircraft)aircraft and $45,924 for the use of a company car and driver for commutation). ForPursuant to an independent third-party security reasons,study the Board of Directors approved a resolution requiring that Mr. Dolan is required to use the company aircraft for all air travel;travel. In addition, the company provides a car and driver to Mr. BonfieldDolan to ensure his safety and security pursuant to the security study and to maximize his time spent on business matters. Mr. Dolan uses this car for commutation to and from work and for business travel. Mr. Andreotti ($39,147126,231 for personal use of company aircraft); Mr. McGoldrickBonfield ($49,76382,650 for personal use of company aircraft); Mr. Hayden ($71,721 for personal use of company aircraft); Dr. Sigal ($30,95062,247 for personal use of company aircraft), and Dr. PalmerMr. McGoldrick ($41,659 for relocation assistance for his family, $19,067 for tax gross-ups related to the relocation and $31,57563,819 for personal use of company aircraft). For Mr. Andreotti these amounts also include $139,792, $144,851, and $153,628 for housing costs while on expatriate assignment for 2005, 2004 and 2003 these included the following: Mr. Bonfield, $1,529,248 relates to costs the company incurred in relocating Mr. Bonfield from the United Kingdom. We paid these costs to our third party relocation vendor for the sale of Mr. Bonfield’s home. We received a refund from the third party vendor of $200,000 in 2004, reducing the 2003 relocation costs to $1,373,980. For Dr. Palmer, the cost includes $138,671 for his relocation from North Carolina, $120,424respectively; $277,699, $232,628, and $343,135 for tax gross up,gross-ups while on expatriate assignment for 2005, 2004 and $80,6082003 respectively, and $11,326, $17,661, and $22,392 for commercial air travel tomiscellaneous expatriate adjustments for 2005, 2004 and from his home in North Carolina prior to his relocation.2003 respectively. Mr. Andreotti’s expatriate assignment ended on September 20, 2005.

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A Long-Term Performance Award was granted in 2001 which covered the three-year performance period from 2001 through 2003. The award was based on cumulative earnings per share, cumulative sales and a total stockholder return ranking versus peer companies. The threshold targets were not met resulting in no payout.

Option/SAR Grants in the Last Fiscal Year

Aggregated Option/SAR Exercises in the Last Fiscal Year

and Fiscal Year-End Option/SAR Values(1)Values⁽¹⁾

Long-Term Incentive PlanPerformance Awards in the Last Fiscal Year

Compensation and Management Development Committee Report on Executive Compensation

We, the Compensation and Management Development Committee, are responsible for administering the compensation program for executive officers and certain other senior management of the company. The Board of Directors has determined that each of us meets the definition of independence under the company’s corporate governance guidelines. We are neither current employees nor former employees of the company nor are we eligible to participate in any of the company’s executive compensation programs. Additionally, we qualify as outside directors for purposes of administering compensation programs to meet the tax deductibility criteria included in Section 162(m) of the Internal Revenue Code and further qualify as non-employee directors for purposes of Rule16b-3 under the Securities Exchange Act of 1934.

Bristol-Myers Squibb’s executive compensation program is based upon a pay-for-performance philosophy. In implementing this philosophy, we consider performance against financial objectives, total stockholder return, and operational objectives consistent with the company’s strategy. We also consider the executive’s demonstration of the values and behaviors defined in the Bristol-Myers Squibb Pledge. We seek an executive compensation policy that is transparent to our stockholdersPledge and in alignment with our stockholders’ best interests.Core BMS Behaviors. We review all elements of compensation both separately and in the aggregateaggregate. We have tallied up all components of the CEO and other named executive officers’ compensation to ensure that the amount of compensation is within appropriate competitive parameters and the program design encourages the creation of long-term stockholder value.

Under our company’s program, an executive’s direct compensation consists of three primary components: base salary, annual incentive (bonus) payment and long-term incentives (which may include cash-based awards, stock-based awards and/or stock options), with the greatest emphasis being placed on long-term incentives to align with long-term stockholder value. In addition, each executive participates in a company fundedcompany-funded pension plan, a company supportedcompany-supported savings plan, and is provided with health and welfare coverage and certain perquisites as disclosed in the Summary Compensation Table.

A goal of our company’s executive compensation program is to provide overall compensation, when targeted levels of performance are achieved, which is at the median of pay practices of a peer group of eleven large industry competitors. The corporations that comprisedwhich includes the peer group for 2004 were Abbott Laboratories, AstraZeneca, Aventis, Eli Lilly and Company, Glaxo SmithKline, Johnson & Johnson, Merck & Co., Inc., Novartis AG, Pfizer, Inc., Schering-Plough Corporation and Wyeth.companies named in the proxy graph. Our executive compensation program is designed to provide value to the executive based on the extent to which individual performance, company performance versus budgeted financial targets, company longer-term financial performance and total return to stockholders (including share price appreciation and reinvested dividends) meet, exceed or fall short of expectations. Under this program design, incentive payments can exceed target levels only if expectations are exceeded.exceeded and will fall below target if goals fall below expectations. We believe that the program we have adopted, with its emphasis on long-term compensation, serves to focus the efforts of the company’s executives on the attainment of sustained long-term growth and profitability for the benefit of the company and its long-term stockholders.

At the time we make executive compensation decisions, we review individual performance and company performance versus that of theother pharmaceutical companies in our peer companies.group. In March of last year, when 20042005 compensation decisions were made regarding merit increases, target annual incentives, stock option and restricted stock grants and target long-term plan awards, we also reviewed detailed data concerning the levels of executive pay among the peer group of companies as well as against certain large general industry companies. This data included analyses provided by our independent compensation consultant, Mercer Human Resource Consulting.

We also believe that the performance management system (newly instituted(instituted in 2003) assists in ensuring that each executive’s financial and operational objectives are aligned with our company’s strategy and that each executive’s compensation awards are appropriately linked to the impact that executive has on driving our strategy forward. Bristol-Myers Squibb employs a performance management system

whereby each executive is rated on their performance against financial and operational objectives consistent with our strategy as well as whether the executive demonstrates behaviors consistent with our Pledge.Pledge and Core BMS Behaviors. These ratings are key determinants of the amount of an individual executive’s merit increase, annual incentive, and stock option and restricted stock awards.

The following explains our considerations in setting the individual components of direct compensation for 2004.

2005.

Base Salary—An executive’s base salary is determined by an assessment of her/his sustained performance against her/his individual job responsibilities including, where appropriate, the impact of such performance on the business results of the company, current salary in relation to the salary range designated for the job, experience and mastery, potential for advancement and the executive’s demonstration of the values and behaviors outlined in the Bristol-Myers Squibb Pledge. In addition, the results and behaviors ratings under the performance management system are key determinants of the size of the executive’s merit increase, if any.

Annual Incentives—Payments under our company’s annual incentive plan, the Performance Incentive Plan, are tied to our company’s level of achievement of annual operating pretax earnings targets, thereby establishing a direct link between executive pay and company financial performance. Annual operating pretax earnings goals for the overall company and each operating group are based upon the budgets for our company as reviewed by the Board of Directors. An individual executive’s annual incentive opportunity is a percentage of her/his salary determined by the executive’s job level. If annual pretax earnings targets fall below a preset minimum threshold, no payments will be made. We also consider each executive’s performance against her/his financial and operational objectives established at the beginning of the year as well as demonstration of behaviors consistent with the Core BMS Behaviors and our Pledge in determining each executive’s individual bonus.

For 20042005 awards, operating pretax earnings targets were established at levels that the Board believed reflected the reasonable expectations management had for the performance of the business. As a whole, our company exceededcompany’s achievement was in line with its pretax earnings goal, resulting in overall incentive payments to executivesproxy named officers which were aboveat or around target. We also reviewed each executive’s individual performance ratings on both results and behaviors to ensure that individual bonuses paid were in alignment with each executive’s performance in carrying out our company’s strategy.

strategy, resulting in some payments slightly above target and some slightly below target.

Long-Term Incentives—In consultation with Mercer Human Resource Consulting, we revised theThe senior executive long-term incentive program for 2004.is made up of the following components.

2004 DesignLong-Term Performance Award

In 2004, we reduced: The Long-Term Performance Award represents approximately 30%-35% of the 2005 long-term program design (with the exception of Mr. Dolan for whom this plan represents 43% of his 2005 long-term incentive). This award, which is delivered in the form of a target number of stock options awarded to executives, while still maintaining them as an important component ofperformance shares, has a three-year cycle. For 2005-2007, the long-term incentive program, and introduced restricted stock,awards are based 50% on cumulative earnings per share, 50% on cumulative sales, with back-weighted vesting (i.e., vesting 1/3 per yearthe ultimate payout modified by the company’s total stockholder return versus the companies in years 3, 4 and 5), as part of our annual program while continuingproxy peer group. If preset threshold targets are not met for the moveperformance period, no payment will be made in 2003 to place greater emphasis onunder the Long-Term Performance Award Plan.

as was the case for the 2002-2004 and 2001-2003 performance periods.

Stock Options: Stock option value represents approximately 35%-45% of the 2004 long-term program design compared to 75% of the 2003 design. The options will vest 25% per year over four years.

Restricted Stock: Restricted stock value represents approximately 30% of the long-term program design for 2004.2005 (with the exception of Mr. Dolan for whom restricted stock represents 28% of his 2005 long-term incentive). Restricted stock vests 1/3 per year in years 3, 4, and 5.

Stock Options: Stock option value represents approximately 35%-40% of the 2005 program (with the exception of Mr. Dolan for whom stock options represent 29% of his 2005 long-term incentive).

Beginning with the 2005 option grants, we approved the use of performance-based exercise thresholds on annual option grants to named executive officers and other senior executives. To satisfy the exercise threshold, Bristol-Myers Squibb stock will need to close at a price of at least 15% above the option grant price for seven consecutive trading days. Although the options will vest according to the normal vesting schedule (currently 25% a year for four years), the executive may not exercise the options unless and until the exercise threshold is satisfied. For 2005 grants, to preserve favorable accounting, the exercise thresholds will lapse beginning in the ninth year. Pursuant to the expensing of options, beginning with the 2006 grants, the exercise thresholds will remain in place the entire term.

The use of these performance-based exercise thresholds, combined with the increased emphasis placed on the Long-Term Performance Award in recent years, assures that approximately 70% of senior executive long-term incentives are tied to specific performance criteria.

To further enhance the link between executive pay and the company’s performance against its business strategy, the size of each executive’s stock option and restricted stock award is determined in large part based on our assessment of the executive’s performance against objectives that drive our company’s business strategy and demonstration of behaviors consistent with our Pledge and the Core BMS Behaviors under the performance management system.

2003—2005 Long-Term Performance Award Plan: The Long-Term Performance Award Plan represents approximately 25%-40% of the 2004 long-term program design. This plan, which is delivered in the form of a target number of performance shares, has a three-year cycle. For 2004-2006, the awards are based 50% on EPS, 50% on sales, with the ultimate payout modified by the company’s total stockholder return versus the eleven companies in its proxy peer group. The targets established under this plan are stretch targets. If threshold targets are not met for the performance period, no payment will be made under the long-term performance award plan as was the case for the 2002-2004 and 2001-2003 performance periods.

We believe this shift to a more balanced mix of long-term incentives, with a greater emphasis on performance shares and other full-share awards, will better align the compensation of senior executives with the creation of long-term stockholder value.

2005 Design

The 2005 design for long-term incentives will be similar to the 2004 design with one important change. Beginning with the 2005 option grants, we have approved the use of performance-based exercise thresholds on annual option grants to proxy named officers and other senior executives. To satisfy the exercise threshold, Bristol-Myers Squibb stock would need to close at a price of at least 15% above the option grant price for seven (7) consecutive trading days. Although the options would vest according to the normal vesting schedule (currently 25% a year for four years), the executive may not exercise the options unless and until the exercise threshold is satisfied. For 2005 grants, to preserve favorable accounting, the exercise thresholds will lapse in years 9 and 10. Pursuant to the expensing of options, this would not be required in future years.

The use of these performance-based exercise thresholds, combined with the increased emphasis placed on the Long-Term Performance Award Plan in recent years, will assure that approximately 70% of senior executive long-term incentives are tied to specific performance criteria.

2002—2004 Long-Term Performance Award Plan Payout—20042005 was the final year in a three-year performance cycle under the Long-Term Performance Award, Plan, which began in 2002.2003. The performance goals for the 2002-20042003-2005 performance cycle were equally weighted 50% on cumulative earnings per share growth,and 50% on cumulative sales growth, andwith a modifier based on relative total stockholder return compared to our company’s proxy peer group. The threshold level of performance required for a payout for the 2002-2004 performance cycle2003-2005 awards was not achieved, so no amounts were earned bymade at 75.1% of target.

Proposed Changes for 2007

Beginning with the 2007 long-term incentive grants, we will reduce the portion of long-term incentives provided in the form of restricted stock for named executive officers for thisfrom approximately 30% to approximately 15%. The value from the decreased restricted stock grants will be allocated across the long-term performance cycle.award plan and stock options with exercise thresholds, thus tying approximately 85% of long-term incentives to specific performance criteria.

Executive Compensation Policies

ClawbackShare Retention Guidelines—In order to preserve the linkage between the interests of executives and those of stockholders, executives are expected to use the shares obtained on the exercise of their stock options, after satisfying the cost of exercise and taxes, to establish a significant level of direct ownership. Our company continues to maintain long-standing share ownership expectations for its executives to meet through the exercise of stock option awards. These share ownership guidelines were revised slightly in 2006 for named executive officers to be consistent with competitive practice while ensuring good corporate governance. Under these guidelines, the Chief Executive Officer must retain shares with a value of eight times his base salary prior to selling any of the net shares obtained upon exercise. The other named executive officers must retain shares with a value of five times their base salary prior to selling any of the net shares obtained upon exercise. Even after these ownership thresholds are satisfied, executives must retain 75% of all net shares obtained as a result of subsequent option exercises for at least two years. These same share retention guidelines apply to restricted stock awards. The Chief Executive Officer and other named executive officers may not sell any of the net shares of stock obtained upon vesting until the ownership thresholds above are satisfied. Thereafter, the executive must still retain 75% of the net shares obtained when a restricted stock award vests for at least two years. We believe these retention requirements are an important tool in aligning the interests of our company’s executives with the long-term interests of our company’s stockholders.

Securities Trading Policy—Executives and other employees may not engage in any transaction in which they may profit from short-term speculative swings in the value of the company’s securities. This includes “short sales” (selling borrowed securities which the seller hopes can be purchased at a lower price in the future) or “short sales against the box” (selling owned, but not delivered securities), “put” and “call” options (publicly available rights to sell or buy securities within a certain period of time at a specified price or the like) and hedging transactions, such as zero-cost collars and forward sale contracts. In addition, this policy is designed to ensure compliance with all insider trading rules.

Recoupment of Equity Awards—Our company maintains clawback provisions relating to stock option, restricted stock and long-term performance awards. Under these clawback provisions, executives that violate non-competition or non-solicitation agreements, or otherwise act in a manner detrimental to our company’s interests will forfeit any outstanding awards as of the date such violation is discovered and will have to return any gains realized in the twelve months prior to the violation. These provisions serve to protect the company’s intellectual property and human capital, and help ensure that executives act in the best interest of our company and its stockholders.

ClawbackRecoupment of Annual Incentive—IncentiveUpon our recommendation,—In 2005, the Board adopted a policy effective March 1, 2005, wherein the Board will seek reimbursement of bonuses paid to an executive if such executive engaged in misconduct that caused or partially caused a restatement of financial results. In such an event, our company will seek to claw back the executive’s entire annual bonus for the relevant period, plus a reasonable rate of interest. This policy may be viewed on our company’s website at www.bms.com.

Share Retention Guidelines—In order to preserve the linkage between the interests of executives and those of stockholders, executives are expected to use the shares obtained on the exercise of their stock options, after satisfying the cost of exercise and taxes, to establish a significant level of direct ownership. Our company continues to maintain long-standing share ownership expectations for its executives to meet through the exercise of stock option awards. These share ownership guidelines are more stringent than most of our company’s peers. Under these guidelines, the Chief Executive Officer must retain shares with a value of 8 times his base salary prior to selling any of the net shares obtained upon exercise. The other named executive officers must retain shares with a value of 5 times their base salary prior to selling any of the net shares obtained upon exercise. Even after these ownership thresholds are satisfied, executives must retain 25% of all net shares obtained as a result of subsequent option exercises. These same share retention guidelines apply to restricted stock awards. The Chief Executive Officer and other named executive officers may not sell any of the net shares of stock obtained upon vesting until the ownership thresholds above are satisfied. Thereafter, the executive must still retain 25% of the net shares obtained when a restricted stock award vests. We believe these retention requirements are an important tool in aligning the interests of our company’s executives with the long-term interests of our company’s stockholders.

Policy Against Repricing Stock Options—We have always maintained a consistent policy against repricing stock options. We believe this is a critical element in maintaining the integrity of our equity compensation program and ensuring alignment of senior executives’ interests with the interests of our stockholders. Based on our recommendation, the Board of Directors adopted a formal policy prohibiting the repricing of stock options. This policy may be viewed on our company’s website at www.bms.com.

Policy regardingRegarding Stockholder Approval of Severance—Upon our recommendation, theThe Board has approved effective March 1, 2005, a policy requiring stockholder approval for any future agreements that provide for cash severance payments in excess of 2.99 times the sum of an executive’s base salary plus bonus. “Cash severance payments” exclude accrued incentive payments, the value of equity acceleration, benefits continuation or the increase in retirement benefits triggered by severance provisions or tax gross-up payments. This policy may be viewed on our company’s website at www.bms.com.

Deductibility of Compensation Over $1 Million—Section 162 (m) of the Internal Revenue Code includes potential limitations on the deductibility of compensation in excess of $1 million paid to the company’s CEO and four other most highly compensated executive officers serving on the last day of the year. Based on the regulations issued by the Internal Revenue Service, we have taken the necessary actions to ensure the deductibility of payments under the annual incentive plan and with respect to stock options and performance shares granted under our plans, whenever possible. We intend to continue to take the necessary actions to maintain the deductibility of compensation resulting from these types of awards. However, the payment of salary in excess of $1 million to Mr. Dolan, and certain taxable benefits and perquisites provided to him, resulted in non-deductible compensation for 2005. In addition, restricted stock granted under our plans generally does not qualify as “performance-based compensation” excluded from the deductibility cap under Section 162(m). Therefore, the vesting of restricted stock in some cases will result in a loss of tax deductibility of compensation, including in the case of the CEO. We view preserving tax deductibility as an important objective, but not the sole objective, in establishing executive compensation. In specific instances we have and in the future will authorize compensation arrangements that are not fully tax deductible but which promote other important objectives of the company.

CEO Compensation

The compensation for Mr. Dolan results from his participation in the same compensation programs as the other executives of Bristol-Myers Squibb. We applied the principles outlined above in establishing Mr. Dolan’s compensation in the same manner as they were applied to the other executives. Mr. Dolan’s compensation is designed to provide direct compensation which approximates the median compensation for chief executive officers in the U.S. proxypharmaceutical peer group when targeted levels of performance are achieved.

We have also ensured Mr. Dolan’s compensation is heavily weighted towards long-term incentives which are directly linked to the creation of long-term stockholder value. In 2004,2005, 10% of Mr. Dolan’s compensation was in the form of base salary, 18% was in the form of annual incentive bonus and 72% was in the form of equity based incentives (comprised of stock options, restricted stock and target long-term performance awards).

AfterMr. Dolan did not receivingreceive a base salary increase for three years, Mr. Dolan received an increase to base salary in 2004 from $1,100,000 to $1,250,000. We made this adjustment in light of the fact that Mr. Dolan’s salary was well below competitive levels. Even with this adjustment, Mr. Dolan’s current salary is positioned in the bottom quartile of the chief executive officers in our company’s U.S. proxy peer group.

2005.

Mr. Dolan’s annual bonus payment for 20042005 was $2,125,000$2,224,875 which is the same amount as his 2003 bonus payment. Mr. Dolan’s 2004 bonus represents 103%104.7% of target. The annual bonus is based on financial performance of the company and on the accomplishments of key objectives in positioning the company for the future. We considered a number of factors to determine Mr. Dolan’s bonus payment, which are summarized below:

Business and Financial Performance

Pipeline Achievements

Execution of our Company Strategy

nearly all of its 10 disease areas of focus. These 10—cancer, HIV/AIDS, affective (psychiatric) disorders, atherosclerosis/thrombosis, diabetes, hepatitis, rheumatoid arthritis, solid organ transplantation, obesity and Alzheimer’s Disease—represent many of our disease areas of focus, including cancer, HIV/AIDS, affective (psychiatric) disorders, atherosclerosis/thrombosis, hepatitis and rheumatoid arthritis—all representing areas of significant unmet medical need.

Corporate Citizenship

Effective March 2, 2004,2005, Mr. Dolan received an option award of 500,500 shares and a restricted stock award of 88,600100,000 shares. The option award has an exercise price of $28.11$25.45 and a Black-Scholes value at grant of $2,767,769.$2,564,282. As with the other named executive officers, all options received by Mr. Dolan in 2005 have a 15% exercise threshold. Although the options vest 25% a year over four years, they may not be exercised until the stock price closes at least 15% above the exercise price for seven consecutive trading days. In order to preserve favorable accounting, the exercise thresholds lapse beginning in the ninth year. Pursuant to option expensing, beginning with the 2006 grants, the

exercise thresholds will remain in place for the entire term. The value of this grant represents approximately 29% of Mr. Dolan’s long-term incentive award mix. The restricted stock award had a value at grant of $2,491,432.$2,529,000. The value of this award represents approximately 28% of Mr. Dolan’s long-term incentive award mix. Overall the value of these awards was consistent with the value of his 20032004 option and restricted stock awards, with the option value as slightly higherlower and the restricted stock value as slightly lower.higher. It was our desire to maintain the approximate value of Mr. Dolan’s 20042005 option and restricted stock awards at 20032004 levels while increasing the long-term performance shares as described below.

Mr. Dolan participates in our company’s long-term incentive plan.program. As with other executives, Mr. Dolan did not receivereceived a payout on the 2002-2004 plan, as the goals necessary for payment were not met.2003-2005 Long-Term Performance Award of 75.1% of target ($1,095,904). The measures for the 2002-2004 plan2003-2005 award were equally weighted as follows: one-third50% cumulative earnings per share, growth, one-third50% cumulative sales, growth,with the final payout modified between 85% and one-third115% based on the company’s relative total stockholder return compared to the company’sits proxy peer group. For the 2004-2006 plan,2005-2007 award, we set a target of 124,000150,000 performance shares, which is an increase over the 20032004 target. We determined this increase was appropriate based on our review of a report of Mr. Dolan’s total direct compensation prepared by Mercer Human Resource Consulting that showed his compensation was significantly below the median of the peer group companies.

It was also our desire to place a greater portion of total long-term compensation in the form of performance shares. This award, which represents 40%43% of Mr. Dolan’s long-term incentive opportunity for 2004,2005, is completely performance based. If performance targets are not achieved, the 2004-20062005-2007 award will not pay out. The goals for this plan are equally weighted 50% on cumulative EPSearnings per share targets

and 50% on cumulative sales targets, with the final payout modified between 85% and 115% based on the company’s relative total stockholder return compared to its proxy peer group. Mr. Dolan will only receive the targeted number of shares if the company meets the cumulative earnings per share and sales targets approved by us and the company achieves total stockholder returns which place it at the median of its peer group for the three-year period. If, as was the case with the 2002-2004 plan, performance against objectives is below threshold, no performance shares will be distributed to Mr. Dolan.

Mercer’s Role

We retained an independent compensation consultant, Mercer Human Resource Consulting, beginning in October 2002. Mercer reports directly to us and has provided us with important assistance in evaluating our executive compensation policy and program and redesigning and enhancing elements of the program where appropriate. We continue to work with Mercer in carrying out our responsibilities of ensuring an executive compensation policy and program which is transparent to, and in the interests of, the company’s long-term stockholders.

Deductibility of Compensation over $1 Million

Section 162 (m) of the Internal Revenue Code includes potential limitations on the deductibility of compensation in excess of $1 million paid to the company’s CEO and four other most highly compensated executive officers serving on the last day of the year. Based on the regulations issued by the Internal Revenue Service, we have taken the necessary actions to ensure the deductibility of payments under the annual incentive plan and with respect to stock options and performance shares granted under our plans, whenever possible. We intend to continue to take the necessary actions to maintain the deductibility of compensation resulting from these types of awards. However, the payment of salary in excess of $1 million to Mr. Dolan, and certain taxable benefits and perquisites provided to him, resulted in non-deductible compensation for 2004. In addition, restricted stock granted under our plans generally does not qualify as “performance-based compensation” excluded from the deductibility cap under Section 162(m). Therefore, the vesting of restricted stock in some cases will result in a loss of tax deductibility of compensation, including in the case of the CEO. We view preserving tax deductibility as an important objective, but not the sole objective, in establishing executive compensation. In specific instances we have and in the future will authorize compensation arrangements that are not fully tax deductible but which promote other important objectives of the company.

Compensation and Management Development Committee

James D. Robinson III, Chair

Lewis B. Campbell, Chair

Vance D. Coffman

James M. Cornelius

Louis W. Sullivan, M.D.

Performance Graph

The following graph compares the performance of Bristol-Myers Squibb for the periods indicated with the performance of the Standard & Poor’s 500 Stock Index (S&P 500) and the average performance of a group consisting of our peer corporations on a line-of-business basis. As previously noted, theThe corporations making up our peer companies group are Abbott Laboratories, AstraZeneca, Aventis, Eli Lilly and Company, Glaxo SmithKline, Johnson & Johnson, Merck & Co., Inc., Novartis AG, Pfizer, Inc., Sanofi-Aventis (including the performance of Aventis prior to its merger with Sanofi), Schering-Plough Corporation and Wyeth.

Total return indices reflect reinvested dividends and are weighted using beginning-period market capitalization for each of the reported time periods. We measure our performance for compensation purposes against the performance of this peer companies group. We measured our performance against this same group in the 20042005 Proxy Statement.

COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN

Assumes $100 invested on 12/31/9900 in Bristol-Myers Squibb Common Stock, S&P 500 Index and Peer Companies Group Index. Values are as of December 31 of specified year assuming dividends are reinvested.