UPDATE 3-Teva Q4 profit rises 20 pct, upbeat on 2008/09
(Adds 2008, 2009 outlook, more comments)
By Steven Scheer and Tova Cohen
TEL AVIV Feb 12 (Reuters) - Teva Pharmaceutical Industries Ltd TEVA.O (TEVA.TA) reported a more than 20 percent rise in quarterly net profit to beat expectations on Tuesday and saw forecast-beating growth in sales and profit in 2008 and 2009.
Teva's results in 2007 were boosted mainly by strong sales of its generic drugs.
Copaxone, Teva's branded treatment for multiple sclerosis, posted sales growth of 15 percent in the fourth quarter although it was largely flat from the prior three months, leading analysts to believe the drug's growth rate may have peaked.
Still, Copaxone in 2007 became the U.S. leader for treating MS, overtaking Biogen's Idec Inc's (BIIB.O) Avonex, and Teva officials expect it to reach No. 1 globally this year.
"As we see the numbers of market share for competitors we believe that in 2008 we will also become the global leader," President and Chief Executive Shlomo Yanai told a news conference.
Israel-based Teva, the world's largest generic drugmaker, posted fourth-quarter net profit of $570 million, or 69 cents per share, compared with $460 million, or 56 cents per share, a year earlier.
Sales for the quarter rose to a record $2.576 billion from $2.28 billion a year earlier.
Analysts on average expected the company to earn 67 cents per share on revenue of $2.486 billion, according to Reuters Estimates.
Its shares were up 0.5 percent in afternoon trading in Tel Aviv, paring losses of more than 2 percent earlier in the day. The Nasdaq shares were flat at $46.82.
After posting record revenues of $9.41 billion in 2007, Teva forecast 2008 revenues of $10.75 billion and adjusted EPS of between $2.60 and $2.75. Yanai told a conference call that he expects adjusted EPS to exceed $3.00 in 2009.
Teva had been forecast to post revenues of $10.41 billion in 2008, EPS of $2.73 and EPS excluding items of $2.67, according to Reuters Estimates. It earned a diluted $2.38 in 2007.
Yanai said the company's outlook includes a planned increase in research and development costs but does not include any significant acquisitions the company may make.
"Acquisitions are an important part of our strategy but they are opportunistic," he said. "There will be acquisitions."
Yisca Erez, an analyst at the Clal Finance Batucha brokerage, said that on the surface, Teva recorded solid results in beating revenue and profit expectations in the quarter.
"But if you look deeper we have a few disappointments especially with Copaxone and with gross profit margins," she wrote in a report.
Teva recorded a gross profit margin of 52.3 percent in the fourth quarter, below an expected 53 percent.
Erez and other analysts said Teva's bottom line was further helped by a lower tax rate in the fourth quarter.
Copaxone sales reached $436 million globally, up 15 percent from the fourth quarter of 2006 but a bit below the $441 million made in the third quarter.
"Copaxone is starting to lose its strength in the United States," Erez said, citing growing competition from Biogen and Elan Corp's ELN.I Tysabri.
Teva said quarterly sales benefited from the launch of a generic version of Wyeth's WYE.N Protonix heartburn drug.
"In less then five weeks since its launch our share is 68 percent (of new U.S. prescriptions)," Yanai said.
Teva shipped supplies of generic Protonix from Dec. 21 but agreed to halt shipments three days under a standstill agreement with Wyeth in order to negotiate a possible settlement. Teva has said it had no plans to resume shipments of the copycat drug.
Yanai said this decision was based only on commercial considerations, not legal. He said that most of the sales of generic Protonix would be recorded in 2008 but some had been accounted for in 2007.
The company declared a cash dividend of 0.45 shekel per share, or 12.4 cents, to be paid on March 6.
Teva noted that as of Feb. 7, it had 160 product applications awaiting U.S. Food and Drug Administration approval, in which branded sales a year are about $100 billion.
Teva believes it is the first to file on 49 of the drugs and said it expects to continue receiving an average of 12 FDA approvals a year. It added that it has 3,166 applications pending approval in 30 European countries, providing "the opportunity to continue its rapid expansion in this region." (Additional reporting by Yinka Adegoke in New York; Editing by Quentin Bryar/Elaine Hardcastle)
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