Teva Pharm Q2 profit beats estimates as shares rise

TEL AVIV (Reuters) - Teva Pharmaceutical Industries (TEVA.O), the world's largest generic drugmaker, reported higher quarterly net profit, boosted by strong sales of generic medicines and branded multiple sclerosis treatment Copaxone.

"We had record generic sales in the U.S. with nine new launches," President and CEO Shlomo Yanai told a news conference on Tuesday.

Teva shares opened up 3.2 percent higher at $51.77 on Nasdaq.

Israel's biggest company in March won a battle to buy generic drugmaker Ratiopharm for 3.7 billion euros ($4.8 billion) to improve its presence in Germany, the world's second-largest generics market. Yanai, a former Israeli army general, expects the deal to close ahead of schedule.

"We believe we will move up the closing of the deal and it will take place this quarter," Yanai said.

Teva's sales in Europe in the quarter rose 10 percent in local currency terms from a year earlier to $811 million, despite government measures to rein in healthcare spending.

"We are waiting for final numbers but we believe this indicates we have increased our market share in generics in Europe," Chief Financial Officer Eyal Desheh said.

Sales were particularly strong in France, Italy and Spain but weaker in Russia.

Teva (TEVA.TA) posted second-quarter net profit excluding one-time items of $1.08 per diluted share, up from 83 cents a share a year earlier. Sales grew 12 percent to $3.8 billion, led by a 17 percent rise in North America.

Teva was expected to earn $1.04 on sales of $3.81 billion, according to Thomson Reuters I/B/E/S.

"The results demonstrate once again the robustness of Teva's business but also its dependence on Copaxone," said Limor Gruber, head of sell-side research at brokerage Psagot, who rates Teva's shares "buy."

COPAXONE SALES RISE

Global sales of Copaxone rose 13 percent to $773 million to remain the top selling MS therapy, Teva said.

Its shares shed 8.6 percent on Nasdaq on Friday after U.S. health regulators approved the first generic version of widely used Sanofi-Aventis (SASY.PA) blood clot treatment Lovenox to the Sandoz generic drug unit of Switzerland's Novartis AG (NOVN.VX) and partner Momenta Inc (MNTA.O).

The approval of the medicine spooked Teva investors, who fear the Food and Drug Administration now might be willing to approve a generic version of Copaxone, which like Lovenox is complicated to make.

Teva does not believe a generic version of Copaxone will be approved before 2013 or 2014, when its patent expires.

Nevertheless, Teva is prepared for the time when Copaxone sales begin to decline after peaking in 2013, Yanai said. Teva estimates sales of the drug will account for only 6 percent of its sales in 2015, down from 20 percent today.

"Teva is not just Copaxone. People are looking at Teva wrongly. It is a big company with a lot of activities," he said.

"We are seeking to have a collection of products in a number of areas to reduce dependence on any one product. We will go from being a soloist to an orchestra," in the branded drugs industry, he said.

Yanai said he had good reason to believe Teva was close to getting approval for its own generic version of Lovenox.

Citi analyst John Boris recommended accumulating Teva shares in the wake of generic Copaxone fears.

Yanai lifted the lower end of Teva's 2010 outlook for adjusted EPS. He now sees $4.50 to $4.60 from a previous $4.40 to $4.60 estimate, but did not change the $16 billion revenue outlook. This excludes Ratiopharm's results.

Teva will pay a dividend of 0.7 shekel, or 18.1 cents a share, on August 19.

(Additional reporting by Steven Scheer; Editing by David Holmes)