Eli Lilly's Earnings Gain on Cialis, Cymbalta Sales (Update7)

2007-10-26T00:21:00.001-07:00

Eli Lilly & Co., the world's biggest maker of psychiatric drugs, said third-quarter profit rose 6 percent, beating analysts' estimates, on surging sales for the antidepressant Cymbalta and the impotence treatment Cialis.
Net income increased to $926.3 million, or 85 cents a share, from $873.6 million, or 80 cents, a year earlier, the Indianapolis-based company said today in a statement. Earnings excluding some items were 91 cents a share, topping the 88-cent average estimate of 15 analysts surveyed by Bloomberg.
Revenue rose 19 percent to $4.59 billion as Cymbalta was approved for treating anxiety. Investors are waiting for data in November from a final-stage trial of Lilly's blood thinner prasugrel, which will compete against Bristol-Myers Co.'s Plavix, and in December, a long-acting version of the diabetes treatment Byetta. Both will offset losses from generic competition to Lilly's top-selling product, the psychiatric drug Zyprexa.
``The earnings aren't the big event here,'' said analyst Les Funtleyder of Miller Tabak and Co. in New York in a telephone interview today. ``They still have to prove they can bring new drugs to market.''
Lilly fell 30 cents to $56.65 at 4 p.m. in New York Stock Exchange composite trading. The stock has gained 8.7 percent this year, beating a 3.7 percent increase in the 14-member Standard & Poor's 500 Pharmaceutical Index.
Forecast Narrowed
Demand for blood thinners has surged as researchers learned how to identify patients most at risk for the clots that trigger heart attacks and strokes. Plavix, given as a pill, generated $6.1 billion worldwide in 2006, trailing only Pfizer Inc.'s cholesterol drug Lipitor. Prasugrel is more potent and may be a superior alternative, entering the marketplace as Zyprexa begins to face generic competition as soon as 2011.
``Our strategy with dealing with the eventual loss of Zyprexa is finding out what's the innovation we can create today,'' said Lilly chief financial officer Derica Rice said in a telephone interview.
The company narrowed its 2007 earnings forecast to $2.76 to $2.81 a share from $2.75 to $2.85, reflecting a licensing agreement announced today with closely held biotechnology company MacroGenics Inc. Lilly also raised estimates excluding some costs for the full year to $3.50 to $3.55 a share from $3.40 to $3.50.
Drug Sales
Cymbalta sales jumped 47 percent to $513.2 million. Cialis generated $311.4 million, a 27 percent increase. Lilly's biggest seller, the schizophrenia drug Zyprexa, gained 8 percent to $1.17 billion after the company raised prices in the second quarter, according to analysts.
``We continue to expect modest worldwide Zyprexa sales growth through the year,'' said John Lechleiter, the president and chief operating officer of Lilly, on a conference call to investors today.
Lilly has submitted studies to the U.S. Food and Drug Administration to seek clearance for Cymbalta's use as a treatment for fibromyalgia, a chronic ailment that causes pain and fatigue. Lilly's drug would compete with Pfizer Inc.'s pain medicine Lyrica, which was approved for fibromyalgia in June.
Cialis is the world's second-best-selling drug for erectile dysfunction after Pfizer's Viagra. Lilly previously shared revenue from Cialis with Icos Corp., which it bought this year for $2.4 billion. Lilly spent at least $73 million to advertise Cialis between January and July 2007, according to data from Nielson Monitor-Plus.

Cialis - $1.61 per pill

Eli Lilly's Earnings Gain on Cialis, Cymbalta Sales (Update7)