Lilly says generic competition hurts fourth-quarter profit, sales

Tue Jan 29, 2013 8:32am EST
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(Reuters) - Eli Lilly and Co (LLY.N: Quote) said on Tuesday that fourth-quarter profit fell as competition from generic drugs, particularly for its once top-selling schizophrenia drug Zyprexa, drove revenue lower.

The U.S. drugmaker earned $827 million, or 74 cents per share, down from $858 million, or 77 cents per share, a year earlier.

Excluding special items such as asset impairments and restructuring, Lilly earned 85 cents per share, beating analysts' expectations by 7 cents per share.

The better-than-expected results were due to cost controls as well as strong sales of key drugs, such as lung cancer treatment Alimta and antidepressant Cymbalta, Lilly spokesman Ed Sagabiel said.

Revenue dropped by about 1 percent to $5.96 billion, but were above Wall Street expectations of $5.81 billion.

Zyprexa, now facing generic competition, saw sales slide 49 percent to $385 million from $750 million a year earlier. The company said the sharp drop was partly offset by gains in sales of other drugs and its animal health products.

Lilly forecast earning would increase this year by 13 percent to 17 percent to $3.82 to $3.97 per share, excluding special items, due to cost controls.

Profit will benefit by 7 cents per share due to a research and development tax credit that was delayed until this year due to the late signing of federal legislation.

On January 4 the company forecast earnings of $3.75 to $3.90 per share, but that did not include the tax benefit.   Continued...