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Drug makers post gains
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October 19, 1999: 10:26 a.m. ET
J&J, Bristol-Myers and Pfizer show increases for 3Q sales, earnings
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NEW YORK (CNNfn) - Three U.S. pharmaceutical companies turned in strong third-quarter profit reports Tuesday on double-digit-percentage revenue gains.
Both No. 2 drug maker Johnson & Johnson and Pfizer Inc., the fourth-largest U.S. drug company, posted better-than-expected earnings, while No. 3 Bristol-Myers Squibb matched analysts' expectations. All three stocks rose on the news amid a broad early rally on Wall Street.
Dow industrials component Johnson & Johnson, a maker of medications for cancer, diabetes and other diseases as well as personal care products, earned $1.1 billion, or 80 cents per diluted share in the latest period. That's up from $961 million, or 70 cents per share, in the year-earlier period.
Analysts polled by research firm First Call had expected earnings of 78 cents per share for the latest quarter.
Sales rose 14 percent to $6.7 billion. The company credited the improvement in part on the performance of its anemia drugs Procrit and Eprex and the antipsychotic medication Risperdal, as well as its Neutrogena cleansing products, Tylenol over-the-counter medications and the new Benecol line of margarines and dressings that are designed to help lower cholesterol.
During the quarter, the company announced it would buy the biotech firm Centocor Inc. in a $4.9 billion deal. The merger closed Oct. 6.
For the first nine months of the year, Johnson & Johnson earned $3.38 billion, or $2.46 per diluted share, up from $2.98 billion, or $2.17 per share, in the 1998 period. Sales rose 17 percent to $20.2 billion.
Johnson & Johnson (JNJ) stock jumped 2-15/16 to 97-7/16.
Bristol-Myers posts 14% gain
Meanwhile, Bristol-Myers earned third-quarter net income of $1.1 billion, or 54 cents per diluted share, up from $966 million, or 47 cents per share, a year earlier.
Sales rose 11 percent to a record $5 billion. Sales of the company's biggest cancer drug, Taxol, rose 23 percent to $375 million. However, sales of its best-selling drug, the cholesterol lowering medication Pravachol, fell 1 percent to $386 million.
For the first nine months, net income totaled $3.11 billion, or $1.54 per share, up from $2.7 billion, or $1.34 per share, in the prior period.
Bristol-Myers (BMY) stock rose 1-7/8 to 73-3/8 in morning trading.
Pfizer beats estimates
Pfizer's third-quarter income rose 36 percent to $906 million, or 23 cents per share, excluding a $310 million inventory charge related to its antibiotic Trovan. The latest results beat Wall Street estimates by 2 cents per share, and exceed the 1998 period's $667 million, or 17 cents a share, that excludes extraordinary charges and gains from discontinued operations.
In the second quarter, the company limited the use of Trovan in the U.S. after regulators warned doctors that it can cause liver toxicity in patients. The European Union suspended Trovan licenses for a year.
Including the charges for Trovan inventories, latest third-quarter net income totaled $701 million, or 18 cents per share, down from $1.4 billion, or 36 cents a share, a year earlier.
Revenue rose 20 percent to $4.0 billion. The hypertension drug Norvasc posted sales of $789 million, a 17 percent increase, while sales of male impotence remedy Viagra grew 77 percent to $249 million. Viagra faced an easy comparison to last year's results, because international distribution of the drug was still beginning in the 1998 period.
Excluding the Trovan charge, net income for the first nine months rose 27 percent to $2.43 billion, or 62 cents per diluted share. Revenue rose 21 percent to $11.7 billion.
Pfizer (PFE) stock rose 1-3/4 to 38-3/4 in Tuesday morning trading.
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