The stock price of Denmark’s Lundbeck jumped yesterday after the firm said it would launch a buyback programme next year for up to 6 billion kroner of its shares, up to end 2007.
The news came as the firm disclosed that second quarter net profit was boosted 16% to 439 million kroner, but that profit from operations dropped 11% to 509 million kroner and sales dropped off 2% to 2.3 billion kroner. It was positive news, though, for Lundbeck’s new drugs - the antidepressant Cipralex/Lexapro (escitalopram) and the Alzheimer’s agent Ebixa (memantine), which rose 45% relative to the year before to 1.6 billion kroner, corresponding to 69% of total revenue. Cipralex itself jumped 43% to 1.3 billion kroner and Ebixa reeled in 265 million kroner, up 55%. The firm is also hopeful for its newly-launched Parkinson’s disease drug, Azilect (rasagiline), which reached its first market earlier this year – the UK [[28/06/05e]].
Lundbeck has long held on to the success of Cipralex’ predecessor Cipramil (citalopram), but took a knocking after US generic drugmakers were given the go-ahead to market their copy-cat versions. Other Lundbeck pharmaceuticals dropped 45% during the second quarter to 645 million kroner.
The company is optimistic for the future, and says the roll-out of Azilect in several European markets later this year and the expected launch of Serdolect are set to further strengthen its revenue in Europe in the years ahead. Lundbeck retains its forecast of a profit from operations of approximately DKK 2.2 billion in 2005.
- Meanwhile, the firm’s Chief Financial Officer, Hans Henrik Munch-Jensen, told Bloomberg that the company will cancel the buyback if acquires a product or company. “If we find something we want to acquire, we'll use the money to invest and grow the company.”