News

Lundbeck Suffers Q2 Loss

08.08.2013 -

Danish pharmaceuticals group Lundbeck posted a bigger-than-expected operating loss in the second quarter, hit by an EU fine for breaking competition law  and cheap competition after some of its drugs lost patent protection.

The company, whose drugs include treatments for depression, Alzheimer's and Parkinson's diseases, saw no revenue growth in the quarter and made an operating loss of 506 million Danish crowns ($90.3 million) against an average forecast for a loss of 319 million in a Reuters poll.

The second-quarter loss stood in contrast with a 1.5 billion crowns profit in the previous quarter and a 118 million loss in the same quarter a year ago.

Lundbeck is facing pressure from the fact that patents on some of its key products have expired and rival manufacturers are launching their own generic versions of the drugs such as copies of its Alzheimer's disease treatment Ebixa.

The company is relying on new drugs to offset falling sales of its antidepressant Cipralex, sold as Lexapro by Forest Laboratories in the United States, which has also been coming off patent in various markets.

Revenue from new drugs grew 60% in the second quarter compared with the second quarter last year, accounting for about 20% of total group revenue.

"With the current growth levels, we expect to achieve growth from 2015," Chief Financial Officer Anders Gotzsche said. "This result proves that we can achieve that," he said.

Sales of new drugs were particularly strong in the United States and markets outside Europe, he said.

Lundbeck's new drugs in the pipeline include treatments for schizophrenia, alcohol dependence and depression.

The company raised the lower end of guidance given in June, saying full-year operating profit should be in a range of 1.3-1.7 billion crowns compared with the 1.2-1.7 billion expected previously. Revenue guidance was revised up to 14.6-15.0 billion crowns from 14.4-15.0 billion.

Gotzsche said the company intended to appeal in September against a decision from the EU Commission to fine it €93 million ($124 million) for violating competition law.