Teva's 1st-Quarter Profit Rises 11% on Copaxone Sales
Petah Tikvah, Israel, May 6 (Bloomberg) -- Teva Pharmaceuticals Industries Ltd., Israel's largest drugmaker, said first-quarter profit rose 11 percent on higher sales as research demonstrated the effectiveness of its proprietary multiple sclerosis treatment, Copaxone.
Net income rose to $28.3 million, or 46 cents per American depositary receipt, from $25.1 million, or 41 cents per ADR, last year. That was in line with an average of 45 cents per share expected by 11 analysts surveyed by IBES International Inc.
Teva, known chiefly as a manufacturer of generic pharmaceuticals, has seen sales climb since the middle of last year for Copaxone, the first drug originated by the company. Sales of the treatment grew both in the U.S. and in Europe, where Teva's $87 million purchase last year of Dutch drugmaker Pharmachemie helped boost distribution.
''The company's future is definitely in Copaxone,'' said Alan Tuchman, an analyst at Oscar Gruss & Son Inc. in New York, who gives the stock a ''buy'' rating. ''They've answered some doubts about its effectiveness, and it has fewer side effects than competing drugs, so doctors are going to prescribe it.''
Tuchman and other analysts said they were impressed with the interest generated by Teva's presentation last month at the annual meeting of the American Academy of Neurologists in Toronto. For the first time, the company was able to offer photographic evidence through magnetic resonance imaging of Copaxone's effectiveness in fighting multiple sclerosis.
Teva, based in Tel Aviv's suburb of Petah Tikvah, also said it's moving forward on an oral form of Copaxone, which patients are likely to prefer over injections.
Teva's American depositary receipts rose 1 to 46 1/2 in early New York trading. They gained 16 percent during the first quarter.
Generics Down
As Copaxone sales boosted overall first-quarter sales to $243.5 million, a 12 percent gain over last year, Teva's sales of generic drugs slipped, particularly of antibiotics as demand sagged because of a mild winter.
Sales of Clonazepam, an anti-convulsant treatment that was Teva's best selling treatment in 1997, fell because of increasing competition, dropping by $12 million during the quarter. Sales of the drug for all of last year were down $96 million from 1997.
In Europe, sales jumped 54 percent for the first-quarter to $83.8 million, or 29 percent of the company's overall sales.
The company expressed confidence in the continued growth of in sales of Copaxone, and analysts said the research presented in Toronto could help remove doubts that have stalled the drug's approval for distribution in the U.K.
''For the first time, new evidence has shown that treatment with Copaxone significantly reduces measured disease activity and burden of disease in patients with relapsing, remitting multiple sclerosis,'' said Chief Executive Eli Hurvitz in a statement.
Teva projects further growth from the 19 generic drugs awaiting approval by the U.S. Food and Drug Administration, whose potential value it places at $7 billion. It said the most significant new drug in the FDA pipeline is the anti-arthritic drug, diclofenac potassium.
Teva said first-quarter sales in Israel dropped by $7.2 million to $63.9 million, which it blamed on the divestiture of its Paca subsidiary and the mild winter.
Hurvitz Troubles
Teva's continuing legal problems, which included Hurvitz's appeal of his conviction on tax fraud charges and a Tel Aviv court's finding that the company infringed on Eli Lilly & Co.'s patent for top-selling antidepressant Prozac, had little effect on the company's earnings, analysts said.
Hurvitz was given a suspended sentence and a 700,000-shekel ($170,000) fine by a Jerusalem court in January. Teva's board of directors said it wants its 67-year-old chief executive to complete his term through 2002.
May/06/ 99 12:11
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