Bristol-Myers Squibb has posted a 73% fall in net income for the fourth quarter to $139 million or $0.07 per share, but revenues sneaked up 2% to nearly $5.2 billion and analysts were reasonably impressed with the figures.
The apparent slump in earnings is principally due to the company taking a $575 million tax charge ahead of repatriating $9 billion in profits from foreign subsidiaries for use in the USA, the same fiscal device Eli Lilly, Johnson & Johnson and Schering-Plough have also taken advantage of [[27/01/05a]], [[26/01/05c]], [[26/01/05d]]. Also hitting earnings was an agreement signed in December to sell its Oncology Therapeutics Network business, so for accounting purposes OTN, which had turnover of $691 million in the quarter, is considered a discontinued operation.
Pharmaceutical sales for the period squeezed up just 1% to $4.1 billion and B-MS acknowledged that generic competition to some of the firm’s former big earners is hurting. Revenues from the diabetes franchise Glucophage/Glucovance (metformin) collapsed 94% to $7 million, while the anti-cancer drug Paraplatin (carboplatin) slid 87% to $27 million. However, turnover of the lipid-lowerer Pravachol (pravastatin) only decreased 3% to $710 million.
Top earner again was the cardiovascular drug Plavix (clopidogrel), up 19% to $959 million, while some of B-MS’ newer products also performed well. The anti-psychotic Abilify (aripiprazole), soared 139% to $191 million, Erbitux (cetuximab) a treatment for colorectal cancer, contributed $88 million and sales of Reyataz (atazanavir), a protease inhibitor launched in the USA in 2003 and in Europe in the second quarter of 2004 [[11/03/04b]], were $148 million.
Other drugs that sold well were the anti-hypertensive Avapro (irbesartan), which rose 13% to $259 million, Sustiva (efavirenz) for HIV/AIDS, up 24% to $172 million and the anticancer agent Taxol (paclitaxel) which increased 7% to $256 million.
Chief executive Peter Dolan described the results as solid overall and said B-MS will “continue to invest meaningfully behind our pipeline,” adding that the firm has high hopes for three promising late-stage compounds; muraglitazar for diabetes, abatacept for rheumatoid arthritis and the hepatitis B treatment entecavir [[05/10/04d]].
The company said it expected to earn between $1.27- $1.37 per share this year and expects sales to hit by $1.4 -$1.5 billion from 2004 levels as products lose exclusivity protection, primarily the antibiotic Cefzil (cefprozil), Paraplatin and the AIDS drug Videx (didanosine)) in the USA, Taxol in Europe and Japan and Pravachol in Europe. Plavix, which had sales of $3.3 billion in 2004, is currently the subject of patent litigation in the US and overseas [[26/01/05e]]. And B-MS, together with partner Sanofi-Aventis, says it is confident of victory in the courts.