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Biotech / Medical : Sepracor-Looks very promising -- Ignore unavailable to you. Want to Upgrade?

To: BMcV who wrote (2429)	4/19/1999 12:20:00 PM
From: Thomas M.	Read Replies (1) \| Respond to of 10280

biz.yahoo.com Monday April 19, 11:50 am Eastern Time Sepracor Hit By Lower Sales of Lilly's Prozac By Ransdell Pierson NEW YORK, April 19 (Reuters) - The stock of Sepracor Inc (SEPR - news) fell sharply Monday after the company's research partner Eli Lilly (LLY - news) announced lower first-quarter sales of the anti-depressant drug Prozac. Lilly is developing a reformulated version of Prozac called R-fluoxetine that was discovered and patented by Sepracor, a biotechnology company based in Marlborough, Mass., that specializes in making improved versions of existing drugs. Sepracor's stock was off $10.75 to $83.25, or 11 percent, in late morning trading on the Nasdaq. Indianapolis-based Lilly was off $3.94 to $78.37 on the New York Stock Exchange. Lilly on Monday, matched Wall Street's earnings expectations with first-quarter profits of $626 million, but the company caused jitters with news that Prozac sales fell 4 percent to $590 million. Lilly last December agreed to pay Sepracor $20 million upfront plus $70 million in later payments for exclusive worldwide rights to the Sepracor compound. Terms of profit sharing were not disclosed, but analysts have theorized that if Sepracor's altered form of Prozac is approved by U.S. regulators and marketed by Lilly, possibly by 2002, Sepracor would derive double-digit sales royalties. ''If Prozac continues to become a smaller drug, that would presumably give Sepracor's future version of Prozac smaller prospects,'' said Carl Gordon, a pharmaceuticals analyst for OrbiMed Advisors in New York. Prozac, a member of the popular class of anti-depressants known as Selective Serotonin Reuptake Inhibitors (SSRIs), is facing keen competition from other SSRIs such as SmithKline Beecham's (quote from Yahoo! UK & Ireland: SB.L) Paxil and Celexa launched last summer by Forest Laboratories Inc (FRX - news). Gordon who estimated that Prozac had global sales of $2.8 billion in 1998, said he had expected annual sales of the blockbuster drug to continue growing about 5 percent a year at least through the year 2000. ''I may have to re-evaluate my Prozac (sales) projections now,'' in the wake of Lilly's disappointing report, Gordon said. Lilly's U.S. patent on Prozac expires in two stages in 2001 and 2003. Sepracor's version of the drug, if approved, would enjoy years of patent life and presumably compete with generic forms of Prozac to be made and marketed by other drug companies. Sepracor's stock has also been boosted in recent months by enthusiasm for another potentially lucrative development deal -- the licensing by Schering-Plough Corp (SGP - news) of Sepracor's altered form of the antihistamine Claritin. But Sepracor stock has retreated from a closing high of $139.37 on March 8 amid a general distancing of investors from pharmaceutical companies in favor of ''cyclical'' companies that tend to benefit from improvement in the global economy.