It's that time again: Earnings time. As you know, Johnson & Johnson and Abbott Laboratories reported earlier this week; today we have Baxter, Novartis, and Biogen Idec. So far it looks like a tough quarter for sales, with currency costs holding down revenues at some companies and new generic competition eating into others.
Still, cost-cutting is helping to offset that revenue loss, with several drugmakers reporting better-than-expected profits. And some surprising sales growth for certain drugs has helped, too. Then there's also the confounding factor of low expectations, however; given the economic climate, analysts haven't been very bullish in predicting pharma earnings. Here's a sampling of the news:
Baxter International reported higher-than-expected net earnings of $587 million, or 96 cents per share, as improved margins helped outweigh the negative impact of foreign exchange rates. The company's bioscience unit performed best, sales-wise, with a 2 percent
rise in sales despite currency effects; without the stronger dollar, those sales would have risen 13 percent.
Novartis boosted its drug-sales forecast, despite the fact that revenue growth was more than canceled out by conversion to dollars. Sales came in at 2 percent below the same period last year, or $10.5 billion. Profits fell by 10 percent to $2.04 billion. Nevertheless, CEO Daniel Vasella predicted "high single-digit" sales growth for the year, up from "mid-to-high" predicted earlier. Among the star products: the blood-pressure remedy Exforge and bone drug Reclast.
During its earnings call yesterday, Abbott Laboratories gave reporters a rundown on its plans for the Humira successor Simponi and touted the 20 percent increase in Humira sales to $1.3 billion. So far, Simponi has been capturing around 500 scrips per week, with 61,000 total weekly prescriptions in its drug class. So it has a long way to go, but Abbott execs called new competition "modest." We'll have to wait and see on that one.
Biogen Idec said second-quarter profit fell 30 percent to $144 million on research costs from its partnership with Acorda Therapeutics. The drugmaker beat analyst estimates, however, and boosted revenue to $1.1 billion on a 27 percent increase in sales of its big multiple sclerosis med Tysabri–despite the slow drumbeat of new cases of a potentially fatal brain infection among Tysabri patients