Knowing how you feel regarding certain drugs, I thought this article might interest you...
thestreet.com
Plunging Prozac Sales Dim Lilly's Outlook
By Adam Feuerstein
Staff Reporter
10/03/2001 09:28 AM EDT
Slumping Prozac sales are depressing Eli Lilly's (LLY:NYSE - news - commentary
- research) profits.
The drugmaker warned Wednesday of lower fourth-quarter and year-end profits due
to a severe erosion in sales of Prozac. Generic versions of the antidepressant drug
hit the market in August.
The company is also taking down 2002 earnings estimates because of increased
investment in new drugs that should begin bolstering Lilly's bottom line in 2003.
Shares of Lilly fell $2.87 to $80 per share on Instinet preopen trading Wednesday.
Lilly reiterated third-quarter earnings of 66 cents per
share, which matches reduced Wall Street
expectations. But fourth-quarter earnings will be in
the range of 59 cents per share to 61 cents per
share. Analysts were looking for earnings of 65
cents per share, according to Thomson
Financial/First Call.
"With nearly two months of Prozac sales data available, the erosion in
prescriptions is the most severe ever for a blockbuster product in our industry. This
affects our financial expectations for 2001 and 2002, with a particular impact in the
fourth quarter of this year," said Sidney Taurel, Lilly's chairman, president and chief
executive officer.
In August, Lilly lost patent protection on Prozac, its top seller, which contributed
$2.5 billion in global sales in 2000. By September, prescription data revealed that
less-expensive generic versions of the drug had grabbed 80% of Prozac's market
share.
Lilly said Wednesday that it now expects full-year 2001 earnings of $2.75 per share
to $2.77 per share, resulting in single-digit earnings-per-share growth for 2001.
This is lower than previous 2001 earnings guidance of $2.76 per share to $2.84 per
share.
Lilly is basically writing off this year and next in anticipation of rebounding sales
and earnings growth starting in 2003. For 2002, the drug maker now forecasts
earnings in the range of $2.70 per share to $2.80 per share. Wall Street was
looking for earnings of $2.94 per share. The reduced earnings are a result of
additional investment required to bring new drugs in the pipeline to market, the
company said.
In 2003, Lilly expects to replace Prozac sales -- and build earnings per share
growth back to the high-teens -- through sales of five new product launches,
including the sepsis drug Xigris, the osteoporosis drug Forteo and the erectile
dysfunction drug Cialis.
Lilly said Wednesday that the Food and Drug Administration has sent an
"approvable letter" to the company regarding Forteo. Several issues, including the
drug's labeling and manufacturing, need to be cleared up before the drug receives
final approval.
Xigris will be discussed at an FDA advisory panel on Oct. 16, while Cialis' approval
application was sent to the FDA in late June.
KJC |
