Teva Fourth Quarter Profit Rises, Sees Strong 2010
Teva Pharmaceutical Industries, the world's largest generic drugmaker, posted a rise in quarterly net profit on higher sales of its multiple sclerosis treatment Copaxone and its acquisition of Barr.
Chief Financial Officer Eyal Desheh said 2010 would be a very strong year for Teva, largely due to new product launches. "There are a lot of growth drivers that will appear on the scene in 2010," Desheh told Reuters.
Teva has forecast 2010 earnings per share of $4.40 to $4.60. President and Chief Executive Shlomo Yanai said the company would discuss its outlook on its conference call with analysts later in the day.
Teva's fourth quarter net income excluding items rose to $847 million, up 28% from a year earlier. Earnings per diluted share rose to 94 from 80 cents.
Sales at Israel's biggest company grew 33% to a record $3.8 billion. Analysts had forecast EPS of 95 cents on sales of $3.8 billion, according to Thomson Reuters I/B/E/S. Gilad Alper, an analyst at brokerage Excellence Nessuah, noted higher-than-expected operating expenses. "Assuming fourth quarter 2009 operating expenses (OPEX) do not mark the beginning of a worrying trend, investors will remain focused on possible acquisitions, and with an expected 35% increase in 2010 earnings per share, the market will need more than an elevated OPEX in one quarter to get spooked," Alper said.
Teva attributed the rise in expenses to higher royalty payments related to Copaxone, the world's leading MS treatment, and other products.
Desheh said this included the re-launch of its generic version of AstraZeneca's asthma medicine Pulmicort Respules. Desheh noted that Teva in 2010 will save "hundreds of millions of dollars" from halting royalty payments of 25% on U.S. sales of Copaxone to Sanofi-Aventis. Royalties will cease in the second quarter, he said.
The company would not comment on specific deals but Desheh said acquisitions remain an integral part of Teva's strategy particularly outside of the U.S. Teva bid earlier this month to buy German peer Ratiopharm, according to people familiar with the process, though Teva has not confirmed this.
