Swiss biopharmaceutical company Serono said second-quarter net profit rose 8% to $189 million, helped once again by a good performance in the USA by its flagship multiple sclerosis drug Rebif.
The rise in profits outstripped revenues growth, up 3% to $699 million, with product sales rising by about the same margin to $629 million. Worldwide sales of Rebif (interferon beta-1a) jumped 11% to $362 million, thanks to a strong performance in the USA where sales rose 24% to $119 million. Sales came in behind expectations, but profits beat forecasts.
Serono’s fertility treatment Gonal F (follitropin) dropped 7% over the second quarter of 2005 owing to continued competition from rival Organon, coming in at $140 million, with growth hormone products Saizen and Serostim flat and bringing in $54 million and $17 million. Generic competition to Novantrone (mitoxantrone) for MS and cancer weighed heavily on sales, which were down 70% to $5.4 million.
Meanwhile, newer product Raptiva (efalizumab) for psoriasis advanced 24% to $17 million, but is not growing as strongly as hoped, in part because of a warning added to its labelling last year warning of a risk of haemolytic anaemia with the drug. Serono has started a massive Phase IV evaluation to try to restore confidence in its safety.
Overall, Serono is now more reliant on Rebif than a year ago, with the MS drug’s share of total revenues increasing from 53% to nearly 58%, at a time when competition in the marketplace is hotting up with the re-launch of rival product Tysabri (natalizumab) from Elan and Biogen Idec.
“Given our financial performance in the first half of 2006, we are on track to achieve our earnings per share guidance of $45,” said Stuart Grant, Serono’s chief financial officer.
There was no news about Serono’s strategic and acquisition plans, put in place last year after the company failed to find a buyer for its business. Serono has set aside $10 billion to fund acquisitions to boost its product pipeline and inject some new momentum into the business.
Meanwhile, on the R&D front, Serono said it had advanced atacicept into Phase II testing in rheumatoid arthritis and had seen positive Phase Ib data in systemic lupus erythematosus.