Actelion flags possible early return to profit growth
ZURICH (Reuters) - Actelion (ATLN.VX), Europe's largest biotech company, said it may return to profit growth sooner than expected after its first-quarter earnings more than doubled and sales of its mainstay drug beat expectations.
The Swiss company received a boost last year after heart and lung drug Opsumit, its replacement for top-seller Tracleer, beat expectations in a clinical trial.
It is looking ahead to October when U.S. regulators are set to decide whether to approve the drug, enabling Actelion to cut its dependence on Tracleer, which makes up almost 90 percent of sales and has faced competition from Gilead's (GILD.O) Letairis.
The company, which hiked its dividend by a quarter in February, signaled it might return to profit growth this year.
"It is possible that some of the forecasted profit growth for 2014 could be brought forward into this year," Chief Financial Officer Andrew Oakley said on Tuesday.
Actelion has forecast stable core earnings in 2013 in local currencies, followed by a return to growth in 2014 and double digit percentage growth in 2015.
Shares in Actelion, which have risen over 60 percent in the past year, were up 3.2 percent at 54.00 francs by 3:33 a.m. ET, within a European healthcare index .SXDP down 0.3 percent.
The stock trades at 14.9 times estimated earnings over the next twelve months, in line with its peers.
Net profit more than doubled in the first quarter to 97.9 million Swiss francs ($105.3 million), after last year's profit was dragged down by one-off factors.
Analysts in a Reuters poll had expected a profit of 76.4 million francs on average.
Sales of Tracleer, a pulmonary arterial hypertension (PAH) drug, rose 4 percent in local currencies to 375 million Swiss francs driven by price increases in the United States.
Actelion spokesman Roland Haefeli said there had been good to high demand for the drug but that it was still experiencing pressure on prices in Europe.
Actelion, which has pledged to cut costs as it seeks to maximize profitability while it develops new treatments to replace Tracleer, cut operating expenses 12 percent in the quarter to 309 million francs.
"Given the company's success at cutting costs, we see potential for significant upgrades to medium-term consensus estimates," said Berenberg analyst Adrian Howd.
However, the company expects costs to increase later in the year due to the expected market launch of Opsumit and as it starts late-stage trials for two other drugs.
Actelion said a late-stage study for selexipag, another drug to treat PAH, was close to full enrollment and it expected to present an interim analysis in coming weeks.
It is also developing a drug to treat skin disease psoriasis as well as an antibiotic for patients suffering from Clostridium difficile associated diarrhea. It is preparing to start late-stage trials for both drugs later this year.
Actelion said it was on track to complete its 800 million Swiss franc share buy-back program this year.
($1 = 0.9298 Swiss francs)
(Editing by Louise Heavens and Mark Potter)