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Genentech's Results Mixed; Drug Sales Disappoint

Genetech
AP
Genetech

Genentech posted mixed results for the third quarter and reported lower-than-expected sales for three out of four of the biotechnology company's key cancer drugs.

Genentech said earnings rose 22 percent from the year-ago period to 73 cents a share, helped by better-than expected sales of Avastin.

The company announced third-quarter revenue of $2.91 billion.

Analysts expected the South San Francisco-based company to report earnings on a non-GAAP basis of 72 cents a share on revenue of $2.93 billion, according to Thomson Financial.

Shares declined almost 4 percent Tuesday.

The company also maintained its forecast for full-year earnings per share growth of 28 percent to 32 percent.

Genentech reported sales of $597 million for blockbuster cancer drug Avastin, compared with the consensus forecast of $585 million. Sales of Avastin, a treatment for colon and lung cancer, rose 37 percent from the same period last year.

Sales of the newer eye-disease medicine Lucentis at $198 million were down from the previous quarter and shy of analyst estimates of $210 million.

U.S. sales of Rituxan for non-Hodgkin's lymphoma and rheumatoid arthritis rose 12 percent to $572 million, also shy of Wall Street estimates of about $588 million.

Lucentis' growth has been hampered by competition from Avastin, which is being used off-label in very small doses at a fraction of the cost of Lucentis.

Genentech last week said it was moving to curtail sales of Avastin to independent compounding pharmacies that divide vials of the cancer drug into tiny portions that ophthalmologists can use to treat wet age-related macular degeneration -- the leading cause of blindness in the elderly. Lucentis is approved for that use while Avastin is not, although the drugs work in a similar manner.

U.S. sales of breast cancer treatment Herceptin rose a modest 6 percent to $320 million, while analysts were looking for about $339 million.

Swiss drugmaker Roche Holding, which owns a majority stake in Genentech, records sales of Genentech drugs outside the United States.