Time for an overview:
Biogen sees 20 pct profit growth through 2005
Tuesday January 7, 9:43 pm ET
SAN FRANCISCO, Jan 7 (Reuters) - Biotechnology company Biogen Inc. (NasdaqNM:BGEN - News), maker of multiple sclerosis drug Avonex, on Tuesday said it aims to increase earnings by an average of 20 percent a year through 2005 by improving profit margins.
At a healthcare conference here, Biogen Chief Executive James Mullen said the Cambridge, Massachusetts-based company also plans to double its revenue to $2 billion over the next three years.
Sales of Avonex exceeded $1 billion last year and Biogen's 2002 net income is estimated at $232 million to $243 million, he said.
Mullen also said Biogen is in the process of diversifying its product lines -- the company expects the U.S. Food and Drug Administration to approve its experimental drug Amevive as a treatment for psoriasis in the first quarter of 2003, while another drug, Antegren, is in pivotal-stage testing for multiple sclerosis and Crohn's disease.
Mullen said he expect Biogen's net margin will increase to 22 to 25 percent by 2005 -- compared with 21 percent in 2002 -- as a result of flatter sales and marketing expenses.
"I don't believe margins north of 25 percent are sustainable," he said.
and from DNA:
Reuters
Genentech says profit on track despite drug delays
Wednesday January 8, 3:28 pm ET
SAN FRANCISCO, Jan 8 (Reuters) - Genentech Inc. (NYSE:DNA - News) is on track to meet its goal of 25 percent annual average earnings-per-share growth through 2005 despite delayed regulatory filings for several experimental drugs, company officials said on Wednesday.ADVERTISEMENT
A year ago, Genentech, the No. 2 biotech firm behind Amgen Inc. (NasdaqNM:AMGN - News), said it was preparing for the launch of up to six new products or product indications in 2003.
"Now, we look forward to multiple launches of new drugs over the next couple of years," Susan Hellmann, Genentech's chief medical officer, told Reuters.
Late last year, Genentech filed with the U.S. Food and Drug Administration for approval of Xolair for asthma and Raptiva for psoriasis. The agency had asked for additional data after initial applications for the drugs were submitted in 2001.
Hellmann said the company "looks forward to discussions with the FDA" over both drugs, but declined to estimate when the agency would issue its decisions.
Genentech a year ago said it expected to file for expansion of Rituxan -- approved to treat low-grade non-Hodgkin's lymphoma -- as a treatment for intermediate to high-grade forms of the disease, but Hellmann said that application will not be submitted this year.
Sales growth of Rituxan, the company's top-selling drug, is being driven by its use as a maintenance therapy, said Myrtle Potter, Genentech's chief operating officer.
"Only 60 percent of lymphoma patients use Rituxan," she added.
Louis Lavigne, the company's chief financial officer, declined comment on specific financial targets, citing the company's release next week of 2002 earnings.
Operating earnings grew by an average 30 percent a year in 1999 through 2001 and will increase by a minimum of 20 percent annually in 2003 through 2005, he said.
Genentech, based in South San Francisco, California, has set a goal of average annual earnings-per-share growth of 25 percent for 1999 through 2005.
I don't recall a recent medium-term forecast by AMGN, but they are certainly predicting strong earnings growth (in the 25% range) next year. Further, GENZ should resume growth next year - underlying Renagel sales are doing fine, and so the inventory adjustment must be basically over by now. I expect respectable growth from MEDI (assuming a good FluMist launch), GILD and IDPH as well. I've kind of lost track of CHIR - anyone know what they are forecasting for the next year or two? Moving down the market caps, CEPH will also do well on the earnings front, and CELG and SCIO should move into profitability over the next two years.
Bottom line overall is that we are due for a strong few years growth by essentially all the first/second tier companies, with little or no regulatory risk. I can't think of another sector where you can expect consistent 20%+ revenue and earnings growth by all the leading companies.
Note that 2002 was more difficult - we had repeated stumbles by GENZ, the acquisition by AMGN that distorted its earnings growth, disappointment from MEDI on FluMist, and regulatory setbacks for DNA.
Peter |
