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Lilly, Schering post gains
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October 20, 1999: 12:11 p.m. ET
Lilly suffers waning Prozac sales; Schering breathes easy with Claritin
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NEW YORK (CNNfn) - Eli Lilly & Co. posted double-digit profit growth for the third quarter Wednesday, matching analysts' expectations, but its stock fell sharply on news that sales of the antidepressant Prozac, its biggest drug, are waning.
Meanwhile, Schering-Plough Corp. also posted healthy earnings growth, boosted by continuing sales of its popular allergy medication Claritin.
Eli Lilly (LLY) met Wall Street's expectations, posting a 15 percent rise in net profit to $679.7 million, or 62 cents per share, excluding a special gain of $67.8 million associated with the sale of marketing rights of its antibiotic Lorabid. Lilly earned $598.8 million, or 53 cents per share, a year earlier, excluding a special charge for the company's joint venture with ICOS Corp.
Total sales rose 13 percent to $2.6 billion, but sales of Prozac dropped 13 percent to $690.2 million, as more competitors came to the market. The company said it is focusing on newer products, to compensate for Prozac's dropping sales. Sales of the Alzheimer's drug Zyprexa, the company's second-biggest seller, rose 27 percent to $502.9 million.
"Our overall growth for the next several quarters will be generated from newer product sales, line extensions of existing products and recent product launches," CEO Sidney Taurel said. "As a result, we will rely less on Prozac sales growth."
Eli Lilly stock slid 5-7/8 to 64, a drop of 8 percent, in late morning trading Wednesday. The stock has traded between 60-9/16 to 97-3/4 over the past year.
Including special items, Eli Lilly earned $732.6 million, or 67 cents per share, in the latest quarter, compared with $518.2 million, or 46 cents per share, in the 1998 period.
The Indianapolis-based company forecast that full-year earnings per share should rise by about 18 percent, not including any unusual buying patterns related to prescription hoarding in advance of the Y2K computer bug problem. Earnings per share growth in 2000 should reach "the mid-teens range" excluding Y2K issues and other one-time events.
For the first nine months, net income rose 15 percent to $1.84 billion, or $1.67 per share, excluding special items. Sales rose 9 percent to $7.2 billion.
Claritin powers Schering growth
Meanwhile, Madison, N.J.-based Schering-Plough (SGP) said its profits rose 20 percent. The drug maker reported net income of $518 million, or 35 cents per diluted share, in line with the First Call consensus forecast. In the year-earlier period, the company earned $432 million, or 29 cents per share.
Third-quarter sales rose 13 percent to $2.2 billion. Sales of Claritin, an antihistamine the company advertises heavily, rose 13 percent to $716 million. Sales of the antiviral and anticancer agent Intron A rose 36 percent to $274 million.
For the first nine months, net income totaled $1.6 billion, or $1.08 per share, up from $1.3 billion, or 90 cents per share, in the year ago period. Sales rose 14 percent to $6.9 billion.
The stock slipped 1/8 to 48-7/8 late Wednesday morning. 
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