Drugmaker Sanofi building new factory in Vietnam

French drugmaker Sanofi SA said Friday that it's building a new medicine factory in Vietnam to supply drugs to that country and others in the region.

The move is part of a fast-growing trend among major international pharmaceutical companies to put factories and research centers in emerging markets that the industry increasingly is targeting for growth.

Paris-based Sanofi said it plans to spend about $75 million to build the factory in Ho Chi Minh City.

The factory will make medicines and consumer health products for sale in Vietnam and for export to other southeast Asian countries. It's expected to be fully operational by the end of 2015.

Medicine sales growth is declining in Western countries _ long the industry's key markets _ as government and private insurance plans there push for discounted prices as part of an effort to rein in health care spending. That's because those countries are squeezed by weak economies, budget deficits and older, sicker populations needing more medical care.

Years ago, drugmakers mainly operated sales offices and distribution centers in emerging markets, countries including China, India, Russia, Turkey, Mexico and Brazil.

Now, governments and a rising middle class in such countries are increasing spending on health care, and most big drugmakers have set goals of producing 25 percent or more of their total sales from emerging markets.

Those companies have found that setting up factories and research centers that hire local workers and collaborate with local research institutions helps sway their governments to buy more medicines from Western drugmakers, rather than just favoring local drugmakers, whose products often are of inferior quality.

And because of lower labor, land and other costs in emerging markets, the big drugmakers can sell their products at much lower prices than what they charge in the West.

Sanofi, the maker of diabetes drug Lantus and injected anticlotting drug Lovenox, noted that the new Vietnam factory will join its network of 40 manufacturing plants in emerging markets.

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Drugmaker Actavis' 4Q earnings sink 70 percent

PARSIPPANY, N.J. -- Actavis Inc., formerly named Watson Pharmaceuticals, said Tuesday that its fourth-quarter earnings fell 70 percent from a year-ago period that got a big boost from the debut of its generic version of the cholesterol fighter Lipitor. Still, results topped expectations and the company backed its outlook for 2013.

Watson recently changed its name to Actavis after completing its $5.6 billion purchase of Swiss drugmaker Actavis Group, which created the third-largest generic drug company in the world.

The newly combined company said Tuesday that it earned $28 million, or 21 cents per share, in the three months that ended Dec. 31. That compares with Watson's profit of $94.8 million, or 75 cents per share, in the final quarter of 2011. Adjusted earnings for the latest fourth quarter fell 10 percent to $1.59 per share.

In 2011, Watson launched an authorized generic version of Lipitor, the world's best-selling drug, under an agreement with Lipitor maker Pfizer Inc. Sales of a generic Lipitor contributed 64 cents to Actavis' earnings in the 2011 quarter compared with just 3 cents in last year's fourth quarter. Several other drugmakers have started selling generic Lipitor since Watson's version debuted. Actavis also said operating costs climbed 26 percent in the latest period to $1.73 billion, due in part to acquisition and integration charges.

The Parsippany, N.J., company's revenue climbed 13 percent to $1.75 billion from $1.54 billion a year earlier, helped by new products in key markets including generic versions of deep vein thrombosis treatment Lovenox, asthma medication Xopenex and ADHD drug Adderall XR in the U.S.

The performance topped Wall Street expectations. Analysts surveyed by FactSet expected, on average, earnings of $1.53 per share on $1.74 billion in revenue.

For the full year, the company earned $97.3 million, or 76 cents per share, as revenue rose 29 percent to $5.91 billion. For 2013, the company reaffirmed a forecast it made last month for adjusted earnings of between $7.70 and $8.10 per share on about $8.1 billion in revenue.

Analysts, on average, expect earnings of $8.03 per share on about $8.1 billion in revenue.

Actavis shares fell 39 cents to $84.85 on Tuesday, while broader trading indexes rose less than 1 percent. The stock is down slightly since closing 2012 at $86.

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