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Drug makers post gains
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July 21, 1999: 9:49 a.m. ET
Eli Lilly, Bristol-Myers, Schering-Plough all meet 2Q expectations
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NEW YORK (CNNfn) - Three leading drug makers posted double-digit percentage growth in second-quarter net profits Wednesday, boosted by surging drug sales in the United States.
The quarterly results of Eli Lilly & Co. and Schering-Plough slightly beat analysts' expectations, while Bristol-Myers Squibb Co. matched Wall Street's forecasts.
Lilly earned a net $576.4 million, or 52 cents per diluted share, up 17 percent from $491.3 million, or 44 cents per share, in the 1998 second quarter. Analysts polled by First Call Corp. had expected the drug maker to turn in profits of 51 cents per share.
Lilly's sales rose 9 percent to $2.3 billion. Sales of the company's leading drug, the anti-depressant Prozac, rose a modest 4 percent to $688.1 million, as overseas sales dropped 7 percent because of unfavorable exchange rates and competitive pressures.
Sales of Prozac have slowed recently as more anti-depressants come on the market. Indianapolis-based Lilly said that for the full year, it anticipates "slight growth" in worldwide Prozac sales.
"The competition is swarming in and we don't know if Lilly is going to be able to keep Prozac going," said Sara Ehrlich, an associate analyst at Deutsche Bank Securities, which has a "buy" rating on the stock. She said Warner-Lambert's new antidepressant Celexa is rapidly gaining ground.
Lilly's insulin products posted a 15 percent gain to $393 million and sales of the Evista osteoporosis medication vaulted 343 percent to $66.6 million.
Meanwhile, Bristol-Myers Squibb, a drug maker and manufacturer of the Clairol line of personal care products, posted a 14 percent gain in net profits and matched First Call's per-share estimate.
Income totaled $952 million, or 47 cents per diluted share, up from $835 million, or 41 cents per share, in the 1998 period.
Sales rose 11 percent to $4.9 billion, led by a 29 percent surge in its U.S. pharmaceuticals business. Sales of its best-selling product, the cholesterol lowering medication Pravachol, rose 5 percent overall to $380 million. Sales of the anti-cancer drug Taxol grew 19 percent to $362 million.
Sales of Glucophage, a treatment of non-insulin dependent type 2 diabetes, rose 47 percent to $350 million. In May, the Food and Drug Administration approved the use of Glucophage and Avandia, a product of SmithKline Beecham, for the treatment of type 2 diabetes.
At Schering-Plough, net profits totaled $547 million, or 37 cents per diluted share, up 20 percent from $455 million, or 31 cents per share, a year earlier. Analysts had projected earnings of 36 cents per share for the latest period, according to the First Call consensus estimate.
Second-quarter sales rose 15 percent to $2.45 billion.
Sales of the antihistamine Claritin rose 19 percent to $819 million. Those results are satisfactory but could have been stronger given that the quarter is prime allergy season, said James Keeney, a pharmaceutical analyst at ABN Amro, which has an "outperform" rating on Schering-Plough stock.
Sales of Intron A and Rebetron, a combination antiviral and anticancer therapy, rose sharply to $276 million, mostly from higher U.S sales.
Schering-Plough, based in Madison, N.J., reiterated earlier projections that full-year earnings per share growth should "approach 20 percent."
Shares of Lilly (LLY) closed down 2-3/16 at 73-13/16 Tuesday amid a big Wall Street sell-off. Schering-Plough (SGP) stock lost 1-7/16 to 52-5/8, and Bristol-Myers Squibb (BMY) dropped 1-3/4 to 71-1/2. 
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