Generic competition, the global recession and unfavourable exchange rates have not stopped some drug companies posting improved third-quarter profits.
Says Edward Jones analyst Linda Bannister: “Their quarters were, overall, better than expected. Most of it was driven by cost cutting, and that’s the theme we’ve been seeing across the industry.”
Merck and Bristol-Myers Squibb are ahead thanks to a few key drugs, with Novartis showing a “tiny” increase in profit on “wonderful results” in its pharmaceuticals division.
The latter says that with its swine flu vaccine approved for sale in Europe and the US it expects sales of $400 million to $700 million (£240 million to £420 million) in the fourth quarter.
Meanwhile, Schering-Plough – about to become part of Merck – blamed unfavourable exchange rates for a sharp drop in profit and a dip in revenue.
Bristol-Myers raised its earnings-per-share forecast by 14 cents, while shares of Merck and Schering-Plough made only small gains. Says Ms Bannister: “Investors are taking a longer-term view of this industry.”
Copyright Press Association 2009