Eli Lilly (NYSE:LLY) said on Thursday that its second-quarter profit slipped about 21% on higher costs and increased generic competition for its Gemzar cancer medicine, however it still matched Wall Street estimates as demand began to pick up for new products.
The Indianapolis-based drugmaker booked net income of $1.2 billion, or $1.07 a share, compared with $1.35 billion, or $1.22 a share, in the same quarter last year.
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Excluding one-time items the company earned $1.18 a share, matching average analyst estimates polled by Thomson Reuters.
Revenue for the three months ended in June was up 9% to $6.25 billion from $5.75 billion a year ago, beating the Street's view of $6.03 billion.
In the second quarter, Lilly once again achieved solid volume-driven revenue growth, despite the negative impact of generic versions of gemcitabine in the United States, Lilly CEO Dr. John Lechleiter said in a statement. Our financial results reflect the solid performance of many of our marketed products, as well as important investments we are making to expand our commercial opportunities and deliver the next wave of potential new medicines to patients.
During the three-month period, the U.S. Food and Drug Administration approved Tradjenta, a prescription medication used to lower blood sugar in adults with type-2 diabetes, and the European Commission granted marketing approval to Bydureon, the first once-weekly treatment for type-2 diabetes.
Reflecting an optimistic outlook, the company revised higher its 2011 non-GAAP earnings view to the range of $4.25 to $4.35 a share, up from its earlier view of $4.15 to $4.30 a share. Analysts are predicting a profit of $4.29 a share.
Yet, Lilly has a rough road ahead as some of its best selling products start losing marketing exclusivity, putting them face-to-face with cheaper generics. The companys $5 billion-a-year Zyprexa schizophrenia drug will lose U.S. marketing exclusivity in October, while its Cymbalta anti-depressant will lose patent protection in mid-2013.
Last November, sales of Gemzar dropped 62% to $112 million when Lilly had a lapse of its U.S. patent.