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Lilly to miss 4Q, '02 marks
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October 3, 2001: 3:44 p.m. ET
Drugmaker hurt by depressed Prozac sales due to generic competition
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NEW YORK (CNNfn) - A sharp drop in sales of Prozac after a generic form of the anti-depressant came to market prompted drugmaker Eli Lilly & Co. to warn Wednesday that it will miss earnings expectations in the fourth quarter and in 2002.
Shares of Indianapolis-based Lilly (LLY: down $3.85 to $79.02, Research, Estimates) fell 5 percent in late afternoon trading.
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 Sidney Taurel, president & CEO of Eli Lilly, talks about Prozac sales, revenue and new products. |
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The company said it still expects to earn 66 cents a share in the just-completed third quarter, in line with forecasts of analysts surveyed by earnings tracker First Call but below the 71 cents it earned a year earlier. But Lilly said it now expects fourth-quarter earnings per share of 59 to 61 cents rather than the First Call estimate of 65 cents. The company earned 70 cents in the fourth quarter of 2000.
Lilly, the nation's No. 8 drugmaker, also expects 2002 EPS of $2.70 to $2.80, rather than the $2.94 consensus estimate.
Sales of Prozac have tumbled in the two months since a generic alternative, fluoxetine, was introduced.
"With nearly two months of Prozac sales data available, the erosion in prescriptions is the most severe ever for a blockbuster product in our industry," President and CEO Sidney Taurel said.
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But Taurel told CNNfn's The Money Gang new products are being developed that collectively will replace the Prozac shortfall over time.
"We have now five products that we expect to launch between the end of 2001 and the end of 2002, and in addition another five products to be launched over the following two years," he said. "There are also several other products under development at earlier stages of development"
Taurel added Lilly's schizophrenia treatment Zyprexa already has become the company's biggest product and over time "has more than replaced" Prozac.
Barr Laboratories Inc. (BRL: up $1.80 to $83.39, Research, Estimates) began shipping a lower-priced generic version of Prozac in August, about a year after it won a court battle to end Lilly's monopoly on the popular anti-depressant. Some insurers have started to push their patients to use the generic version of the drug. 
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