Abbott Profit Rises as Humira, Other Drugs Shine
Abbott Laboratories posted higher second-quarter earnings Wednesday on increased sales of its prescription drugs, with global revenue from arthritis treatment Humira jumping 50%.
The company said it earned $989 million, or 63 cents per share, up from $612 million, or 40 cents per share, a year earlier, when Abbott took charges related to its acquisition of the vascular business of Guidant.
Excluding special items, Abbott earned 69 cents per share.
On that basis, analysts on average expected 68 cents per share, according to Reuters Estimates.
Sales rose 16% to $6.37 billion, slightly higher than Wall Street expectations. Revenue growth would have been 2.7% less if not for favorable foreign exchange factors.
Global sales of prescription drugs jumped 17% to $3.53 billion. Humira sales rose to $735 million, putting it on track to post annual sales approaching $3 billion. The drug was helped by approvals from U.S. and European regulators earlier this year for use to treat Crohn's disease, an inflammatory bowel disorder.
Sales of Depakote, used to treat epilepsy and bipolar disorder, rose 27% to $404 million, while sales of HIV treatment Kaletra grew 19% to $315 million. Revenue from Tricor, which reduces levels of blood fats known as triglycerides, rose 21% to $302 million.
Niaspan, a drug that boosts levels of "good" HDL cholesterol, had sales of $170 million. Abbott acquired Niaspan in the purchase last year of Kos Pharmaceuticals.
The company's line of medical diagnostics had sales of $799 million, up 11.4%. Sales of its stents -- tiny devices used to prop open heart arteries that have been cleared of plaque -- and other vascular products rose 63% to $423 million.
Abbott Changes 2007 Outlook Slightly
Abbott last month asked U.S. regulators to approve its new drug-coated stent, called Xience, and expects to be selling the device in the first half of 2008. Xience was introduced in Europe and Asia in late 2006.
Abbott slightly changed its 2007 earnings forecast, to between $2.80 and $2.84 per share, from its earlier view of $2.79 to $2.85. The new forecast translates into growth of 10.6 to 12.2%.
It continues to expect third-quarter earnings of 64 cents to 66 cents per share, reflecting its retention of two diagnostics units it had hoped to sell to General Electric .
The planned $8.1 billion sale of the units to GE collapsed earlier this month after the two companies failed to agree on final terms.
Some analysts speculated that quality-control problems at an Abbott manufacturing plant in Dallas, cited by U.S. regulators in April, may have tainted the diagnostic units and made them less valuable in the eyes of GE.
One of the diagnostics units makes in-vitro diagnostics, while the other involves tests performed at the patient bedside, such as blood chemistry.
Abbott, based outside Chicago, had hoped to use proceeds from the GE deal to pay down debt and buy new products. By selling the two diagnostic units, while holding on to its faster-growing diabetes and molecular diagnostics businesses, Abbott had hoped to continue boosting overall profit margins.