Better-than-expected results for the first quarter have raised hopes at German drugmaker Schwarz Pharma that it will break-even at net level later this year.
The group saw its net profit double to 2.2 million euros ($2.7 million), or 0.05 euros a share, for the period, on lower taxes and higher sales.
But revenue growth of 3.9% to 247 million euros was given a helping hand by currency exchange effects; organically, turnover actually dipped 0.4% from the year-ago quarter, as the majority of sales were used to fuel development of the group’s pipeline.
Schwarz is currently morphing from a generics-focused company into one that is developing its own products, in a move designed to cut its reliance on sales of its top-selling product - a generic version of AstraZeneca’s blockbuster Prilosec (omeprazole).
Sales of omeprazole reached 1.5 billion euros at their height in 2003, but the introduction of other copycat versions has significantly eaten into the Schwarz’ market share ever since. Even so, global turnover of omeprazole still rose 2.2% to 51.5 million euros in the quarter.
The company is expecting sales of around 900 million euros for the full year, as mounting R&D expenses will be countered, to some degree, by turnover of its new Parkinson’s patch Neupro (rotigotine transdermal), which has been launched in its first markets.
“The performance of our business in the first quarter builds a solid basis for achieving our financial targets for 2006,” stated Patrick Schwarz-Schuette, the firm’s Chief Executive. And commenting on Schwarz’ growth strategy, he said: “we will continue to focus on research and development in order to further strengthen our clinical development pipeline.”