Drugmaker Bristol-Myers Squibb Co. reported a 76 percent increase in the fourth-quarter profit Thursday, due to higher sales of eight drugs, lower taxes and a big charge a year ago, but it still fell short of Wall Street's expectations.
The company focused attention on rapid sales growth for aits three-year-old Type 2 diabetes pill Onglyza, which until now have been tepid compared to Merck & Co.'s blockbuster rival drug, Januvia. Onglyza sales jumped 110 percent to $153 million, almost as much as sales for all of 2010. But sales continued to fall for blood thinner Plavix, the world's second-best-selling drug, and blood pressure drug Avapro.
Net income rose to $852 million, or 50 cents per share, up from $483 million, or 28 cents per share, in the 2010 quarter.
The New York company said fees and discounts under the U.S. health care overhaul reduced earnings per share by 4 cents in the latest quarter, but drug prices rose 3 percent on average.
The year-earlier results were weighed down by $324 million in charges, for streamlining global operations, depreciation and shutdown costs, licensing payments and a tax charge.
Adjusted income rose 12 percent to $906 million, or 53 cents per share, from $807 million, or 47 cents per share, for 2010's fourth quarter. Total sales increased 7 percent to $5.45 billion from $5.11 billion.
Those results missed analyst expectations of 55 cents per share on sales of $5.51 billion, according to FactSet.
"Investors weren't expecting much and they didn't get much," said Erik Gordon, an analyst and professor at the University of Michigan's Ross School of Business. "A couple of products beat their sales estimates by a hair and a couple missed by a hair."
Bristol-Myers said it expects 2012 earnings per share between $1.90 and $2.00, and sales of $17.2 billion to $18.2 billion. Analysts are looking for $1.98 per share and sales of $18.27 billion, on average.
Company shares fell 15 cents to $32.55 in afternoon trading Thursday.
"We delivered solid results while setting the stage for a strong future," CEO Lamberto Andreotti told analysts during a conference call, adding the company has the products, pipeline and management team to grow beyond its upcoming patent expirations.
Bristol-Myers and French partner Sanofi SA jointly market Plavix, which posted a 3 percent drop in sales to $1.67 billion. It loses U.S. patent protection in May.
That happens to Avapro and foreign counterpart Avalide in March. Their combined sales fell 23 percent, to $195 million, because they have generic competition elsewhere and one of the three dosage forms still isn't available due to a recall.
Bristol's No. 2 drug, Abilify for schizophrenia and bipolar disorder, loses patent protection in the U.S. in 2015. Its sales rose 4 percent to $737 million.
Abilify, Plavix and Avapro together produce half of Bristol-Myers' revenue.
Given the looming generic competition, Bristol for some time has given profit forecasts for 2013, and as of July forecast $1.95 per share, excluding special items. But on Thursday, executives said they are still aiming for that but won't update it until next January.
"The markets have seemed to shrug off this," BernsteinResearch analyst Dr. Timothy Anderson wrote to investors, crediting Bristol's success recently in getting new drugs approved, such as Yervoy for metastatic melanoma and Nulojix for organ transplant patients. But he wrote that Bristol's stock price is high given that the company is "likely to have growth that is flattish from 2011-2020," and that could limit share price appreciation.
Last year, Bristol initiated a dozen or more partnerships and deals aimed at developing new drugs.
Executives said they are preparing for a U.S. launch of heavily touted anti-clotting pill Eliquis, which is approved in the European Union for preventing clots in patients getting hip or knee replacements. Bristol and partner Pfizer Inc. are seeking Food and Drug Administration approval to sell Eliquis for stroke prevention, a market with millions more patients, and expect a ruling by March 28.
Last week, the FDA said it wouldn't approve another much-anticipated drug, dapagliflozin for Type 2 diabetes, without more data to evaluate its risks and benefits. Andreotti said the company was disappointed but is confident in the drug's value and is working on the issues with the FDA.
For full-year 2011, the company earned $3.71 billion, or $2.16 per share, on sales of $21.24 billion. Excluding one-time items income was $2.28 per share.
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