Abbott Laboratories has reported a 3.5% increase in sales in the third quarter of 2006, although its pharmaceutical division did not fare so well with a 7.5% decline in turnover, mainly as a result of a slowdown in the firm’s hospital products business in the USA.
The bright points in the business were sales of rheumatology product Humira (adalimumab), which rose 52% to $541 million in the quarter, or nearly 10% of Abbott’s total revenues of $5.57 billion, as well as the contribution from the vascular devices business acquired from Guidant earlier this year.
Net income rose to $716 million, or 46 cents per share, compared with $681 million, or 44 cents per share, during the same period last year. This year’s results include costs related to the acquisition.
Humira’s strong performance helped offset the impact on sales of Abbott’s terminated agreement with Boehringer Ingelheim for the US distribution of three drugs, including the arthritis treatment Mobic (meloxicam), and overall the figures came in a little higher than analysts’ expectations.
The newly acquired vascular business provided another key impetus for growth, with total sales of $351 million during the quarter. Depakote (divalproex sodium) for epilepsy, Abbott’s second largest product by sales, also made a solid contribution rising 29% to $339 million, although it is getting a little long in the tooth and could see generic competition in 2008.
Analysts Gustav Ando from Global Insight also noted that Abbott could face additional pressure next year when it loses patent protection for Omnicef (cefdinir), an antibiotic which brought in $135 million in the third quarter, up more than 50% year-on-year.
Income from Abbott’s joint venture with Japan's Takeda, TAP, rose 5% to $121 million, driven by gastrointestinal drug Prevacid (lansoprazole), up 8.3% to $663 million in a particularly strong quarter.
R&D costs grew 38%, mainly because of spending on new indications for Humira, and did not include the costs associated with dropping Abbott’s drug-eluting stent ZoMaxx earlier this month in order to focus on the Xience V product acquired from Guidant.