Teva Pharmaceutical Industries Ltd. (TEVA)’s first-quarter profit fell 26 percent as a branded drug lost patent protection and opportunities diminished to introduce new generic medicines.
Earnings excluding some costs declined to $960 million, or $1.12 a share, from $1.3 billion, or $1.47, a year earlier, the Petach Tikva, Israel-based company said in a statement today. Profit beat the average estimate of $1.11 a share from 20 analysts surveyed (TEVA:US) by Bloomberg.
Teva’s branded-drug sales dropped as Provigil, a sleep- disorder medicine it got in the $6.5 billion acquisition of Cephalon Inc. in 2011, lost patent protection last year. Sales of generics were higher in last year’s first quarter as Teva began selling seven new products and benefited from a partnership with Ranbaxy Laboratories Ltd. for copies of Pfizer Inc.’s Lipitor.
Revenue from Copaxone, the branded multiple-sclerosis treatment that is Teva’s best-selling product, increased 17 percent in the quarter to $1.1 billion as Teva boosted the price of the injection. Copaxone faces new competition from Biogen Idec Inc.’s Tecfidera, which grabbed an 8 percent share of the MS pill market in the week ended April 19, according to Bloomberg Industries.
Feedback from doctors suggests some Tecfidera patients are switching from Copaxone, according to Marko Kozul, an analyst with Leerink Swann & Co.
Chief Executive Officer Jeremy Levin said in November that revenue this year will be between $19.5 billion and $20.5 billion while earnings excluding some costs will be $4.85 to $5.15 a share. With no immediate replacement for the expected decline in Copaxone revenue as competition from oral drugs increases, Levin has pledged to cut as much as $2 billion of costs in the next five years.
Teva shares fell 0.5 percent to 136.50 shekels at 2 p.m. in Tel Aviv, when trading was halted for the announcement. The stock touched a 19-month low today. The more actively traded American depositary receipts have lost 14 percent in the past year including reinvested dividends, compared with (TEVA:US) a 32 percent return for the Bloomberg Europe Pharmaceutical Index.
Sales dropped 3.9 percent to $4.9 billion, beating the average estimate of $4.86 billion. Revenue from generic drugs in the U.S. fell 27 percent to $895 million. In Europe, generic sales rose 9 percent to $873 million.
Teva will hold a conference call with analysts at 8 a.m. New York time.
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