By Dow Jones Business News, October 23, 2013, 07:44:00 AM EDT
By Peter Loftus
Drug maker Bristol-Myers Squibb Co. ( BMY ) returned to sales growth for the third quarter, after more than a year of
declining sales on the 2012 loss of U.S. patent protection for big-selling products including the heart drug Plavix.
Bristol also swung to a higher-than-expected third-quarter profit, and reiterated its forecast for full-year 2013
The New York-based company has had success bringing some new drugs to market, including skin-cancer treatment Yervoy,
and it has some promising treatments in development for cancer and hepatitis C. But for the second half of 2012 and the
first half of 2013, revenue from the newer drugs wasn't enough to offset the sales of Plavix and the blood-pressure
drugs that were lost to generic competition.
Now, the year-over-year impact of the patent losses has passed. For the third quarter, Bristol said it earned $692
million, or 42 cents a share, reversing a loss of $711 million, or 43 cents a share, a year earlier. Both periods
included restructuring charges and other items, and the year-earlier period was weighed down by a large impairment
charge for the termination of an experimental hepatitis C drug due to safety concerns. The company continues to develop
other treatments for the disease.
Excluding these items, third-quarter earnings rose to 46 cents a share from 41 cents a share a year earlier, ahead of
the 44-cent-per-share mean estimate of analysts surveyed by Thomson Reuters.
Third-quarter sales rose 9% to $4.07 billion, ahead of the Thomson estimate of $4 billion.
Gross margin as a percentage of net sales was 71.1% in the quarter, versus 73.6% in the same period a year ago.
Sales of antipsychotic Abilify declined 16% to $569 million due to revenue-sharing terms of Bristol's contract with
marketing partner Otsuka Pharmaceutical. Sales also declined for Plavix and blood-pressure drugs Avapro and Avalide.
But sales for most other top products increased. Yervoy sales rose 33% to $238 million. Sales of hepatitis B treatment
Baraclude rose 9% to $378 million.
Bristol recorded $41 million in third-quarter sales of Eliquis, an anti-clotting drug co-marketed with Pfizer Inc.
(PFE). Prescription volume for the drug has been disappointing since it went on sale in the U.S. earlier this year due
to competition from other drugs and less-favorable reimbursement by insurers. The companies have vowed to boost sales
through increased promotional efforts aimed at consumers and physicians.
Bristol's advertising and product-promotion spending increased 16% to $194 million for the quarter.
Bristol reiterated its forecast of full-year 2013 earnings of $1.41 to $1.49 a share, or $1.70 to $1.78 excluding
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