Valeant says generic approval could lower profit

Valeant Pharmaceuticals International Inc. said Thursday that a newly approved generic version of one of its drugs could significantly reduce its profits this year.

Mylan Inc. on Wednesday received final approval from the U.S. Food and Drug Administration to sell the first generic version of Valeant's Zovirax ointment, which is used in the treatment of herpes. It will start shipping the product immediately.

Valeant said that while the timing of the approval wasn't certain, the company knew it was coming and prepared for it. The Canadian company announced plans to launch its own generic version of the drug immediately.

But Valeant said that it didn't factor the approval into its original budget expectations and warned that the event could reduce its 2013 profit by between 30 and 40 cents per share.

It added that other actions, including several product acquisitions and the repricing of its term loan debt, which have taken place since it announced its financial guidance in January, could partially offset the effects of the Zovirax genericization.

Valeant said in January that it expected a 2013 profit of $5.45 to $5.75 per share on $4.4 billion to $4.8 billion in revenue. Analysts polled by FactSet currently expect a profit of $5.63 per share on $4.62 billion in revenue.

The company said Thursday that it will update its 2013 guidance when it releases its first quarter financial results in May.

Valeant's U.S. shares fell $1.81, or 2.5 percent, to $70.06 in morning trading.

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UPDATE 2-Tenet swings to profit as hospital visits rise

* Q4 profit 45 cts/shr vs loss 70 cts/shr year ago

* Outpatient visits up 7.3 pct

* Outpatient surgeries rise 13.9 pct

* Reiterates 2013 EBITDA outlook

* Shares down 1 percent

Feb 26 (Reuters) - Tenet Healthcare Corp on Tuesday reported a fourth-quarter profit versus a year-ago loss as outpatient hospital visits increased and said it sees health reform next year will have a positive impact on earnings.

An estimated 26 million people, many of them now uninsured, are expected to obtain coverage through health insurance exchanges being set up under the U.S. Patient Protection and Affordable Care Act.

Tenet, the No. 3 for-profit U.S. hospital chain, said it has traditionally served a larger number of uninsured patients than other publicly traded chains. This burden is expected to diminish as those patients are insured through the exchanges, beginning in 2014.

"We see a lot of upside in our markets," Tenet Chief Executive Trevor Fetter said on a conference call.

Fetter said Tenet recently signed its first contracts with three Blue Cross and Blue Shield plans for health insurance to be sold through the exchanges, covering about 30 percent of its hospitals. The plans have a similar structure as its commercial contracts, with a pricing discount of less than 10 percent from current rates.

"Where we have accepted any discount at all, it is for additional market share," Fetter said.

Tenet posted fourth-quarter earnings of $49 million, or 45 cents a share, compared with a loss of $76 million, or 70 cents a share, a year earlier, when the company took a large charge for the early retirement of debt.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) increased 16.7 percent to $336 million. Net operating revenue rose 7.3 percent to $2.33 billion.

Tenet reiterated its outlook for 2013 EBITDA of $1.325 billion to $1.425 billion.

In the fourth quarter, Dallas-based Tenet said adjusted patient admissions rose 2.9 percent, with outpatient visits up 7.3 percent and outpatient surgeries climbing 13.9 percent. Total admissions were flat, while emergency room visits increased 8.6 percent.

Uninsured and charity admissions rose 1.1 percent. Bad debt expenses as a percentage of revenue was 7.9 percent, up from 7.7 percent from a year ago, as more uninsured patients sought treatment, Tenet said.

Tenet shares were down 1.4 percent at $37.12 on the New York Stock Exchange.

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Tenet Healthcare Releases Q4 Profit

 Highlight transcript below to create clipTranscript:  Print  |  Email Go  Click text to jump within videoTue 26 Feb 13 | 08:17 AM ET Trevor Fetter, President & CEO of Tenet Healthcare, breaks down the company's quarterly numbers and weighs in on spending cuts in Washington and the outlook for the health care industry.

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Acquisitions help Jazz Pharma 4Q profit soar

Jazz Pharmaceuticals PLC's fourth-quarter earnings soared, as the Irish drugmaker's revenue swelled due to acquisitions and sales growth for its narcolepsy treatment Xyrem.

The Dublin-based company also said Tuesday after markets closed that it had a deal to develop and sell a key compound in Xyrem, a move that could strengthen the company's patent protection of the drug.

In the quarter ended Dec. 31, Jazz reported net income of $200.6 million, or $3.28 per share, up from $37.5 million, or 79 cents per share, a year earlier. Adjusted earnings in last year's quarter totaled $1.53 per share.

Revenue more than doubled to $183.7 million from $80.9 million a year ago.

Analysts surveyed by FactSet expected, on average, earnings of $1.40 per share on $182.4 million in revenue.

Last June, Jazz said it completed its purchase of cancer drug maker EUSA Pharma for $650 million. In January, Jazz completed its all-stock acquisition of privately held Azur Pharma Ltd., a combination that created a specialty drug company headquartered in Dublin. Jazz was based in Palo Alto, Calif.

Jazz said the acquisitions helped drive its revenue increase. Xyrem sales climbed 58 percent to $113.5 million compared to last year's quarter.

The acquisitions also contributed to steep growth in operating expenses to $116.3 million from $45.8 million.

For the full year, Jazz earned $288.6 million, or $4.79 per share, up from $125 million, or $2.67 per share, a year earlier, Annual revenue rose to $586 million from $272.3 million a year ago.

Jazz said it expects adjusted earnings to range between $5.70 and $5.90 per share in 2013 on revenue ranging from $805 million to $835 million. Analysts expect earnings, on average, of $5.72 per share on $805.2 million in revenue.

Jazz said it reached an agreement with Concert Pharmaceuticals Inc. that gives Jazz worldwide rights to develop and sell Concert's deuterium-modified sodium oxybate compounds. Sodium oxybate is the active ingredient in Xyrem.

Brean Capital analyst Gene Mack said in a research note the deal strengthens Jazz's patent protection for Xyrem, and it also could allow for once-daily dosing of the drug.

U.S.-traded shares of the company climbed 2.1 percent, or $1.17, to $58 before the markets opened Wednesday.

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Teva Pharmaceutical 4Q profit falls 37 percent

Teva Pharmaceutical Industries Ltd.'s fourth-quarter earnings sank 37 percent, as generic competition from other companies hurt revenue for one of the world's biggest generic drugmakers.

The Israeli company said Thursday its revenue from the United States fell 14 percent in the quarter to $2.62 billion, as sales of one of its brand-name products, Provigil, slid due to cheaper, generic competition.

Provigil treats tiredness caused by narcolepsy, obstructive sleep apnea, and changes in work schedule. Teva acquired the drug when it bought Cephalon Inc. in 2011. As part of that deal, antitrust regulators required Teva to sell the U.S. rights to generic Provigil to another company. Par Pharmaceutical Cos. bought those rights and began selling a generic version of the drug last year, as did another company, Mylan Inc.

Teva said Provigil's revenue tumbled to $25 million from $350 million in the final quarter of 2011, as it joined large drugmakers like Pfizer Inc. and Eli Lilly and Co. that also have seen sales fall after losing U.S. patent protection for key products.

Overall, Teva earned $320 million, or 37 cents per share, in the three months that ended Dec. 31. That compares to earnings of $506 million, or 57 cents per share, in the 2011 fourth quarter. Adjusted earnings totaled $1.32 per share.

Total revenue fell more than 7 percent to $5.25 billion.

Analysts expected, on average, earnings of $1.33 per share on $5.26 billion in revenue, according to FactSet.

Teva said revenue from generic drugs, which made up slightly more than half its total, fell 11 percent in the quarter to $2.7 billion. The company said the decline came largely due to a tough comparison with the final quarter of 2011, when it saw "extraordinary" contributions from its launch of a generic version of Lilly's antipsychotic Zyprexa and from an agreement related to another company's launch of generic Lipitor, a cholesterol fighter made by Pfizer.

For the full year, Teva earned $1.96 billion, or $2.25 per share, on $20.32 billion in revenue.

U.S.-traded shares of Teva fell 30 cents to $37.86 Thursday morning, in line with slight decreases from broader trading indexes. The share price has fallen about 15 percent over the past year.

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Roche's CEO on Profit Pipeline

 Highlight transcript below to create clipTranscript:  Print  |  Email Go  Click text to jump within videoFri 01 Feb 13 | 07:31 AM ET Severin Schwan, Roche CEO, discusses the company's future growth plans developing innovative medicines to fight the battle against cancer and Alzheimer disease.

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Lilly fourth-quarter profit fall as generics hurt sales

  Published: Tuesday, 29 Jan 2013 | 6:43 AM ET

Jan 29 (Reuters) - Eli Lilly and Co said on Tuesday that fourth-quarter earnings had fallen as competition from generic drugs drove revenue lower.

The U.S. drugmaker said it had earned $827 million, or 74 cents per share, compared with $858 million, or 77 cents per share, a year earlier.

Excluding special items such as asset impairments, restructuring and other special charges, Lilly earned 85 cents per share. Analysts on average were expecting 78 cents per share.

Jan 29- Eli Lilly and Co said on Tuesday that fourth-quarter earnings had fallen as competition from generic drugs drove revenue lower. The U.S. drugmaker said it had earned $827 million, or 74 cents per share, compared with $858 million, or 77 cents per share, a year earlier.

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Actavis, formerly Watson, sees 2013 profit growth

Jan 25 (Reuters) - Actavis Inc, the generic drugmaker previously known as Watson Pharmaceuticals, said on Friday that it expected earnings to rise at least 30 percent in 2013 as it expands globally, but its outlook still came in short of analysts' expectations.

Actavis said it expected earnings to rise to a range of $7.70 to $8.10 per share in 2013. Analysts on average are expecting $8.20 per share, according to Thomson Reuters I/B/E/S.

The third-largest global generic drugmaker changed its name this week from Watson after buying Actavis as part of its strategy to expand in international markets and offer more specialty drugs.

The company, which is holding a meeting with investors on Friday, said it expected 2012 earnings per share to be at the high end of its forecast range of $5.85 to $5.95.

That is in line with analysts' expectations for earnings of $5.93 per share, according to Thomson Reuters I/B/E/S, and represents growth of 25 percent from 2011.

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Actavis predicts 2013 profit growth short of St.

PARSIPPANY, N.J. -- Generic drug developer Actavis Inc., formerly named Watson Pharmaceuticals, predicted profit growth for 2013 that was short of Wall Street's expectations.

The Parsippany, N.J., company changed its name to Actavis after buying Swiss drugmaker Actavis Group for about $5.6 billion in October.

Actavis' financial outlook for 2012 was in line with market predictions. The newly combined company said Friday before its investor meeting in New York that it expects 2012 adjusted earnings to be at the high end of a previously forecast range of $5.85 to $5.95, with revenue growing 29 percent to $5.9 billion.

Analysts polled by FactSet expect profit of $5.93 per share on revenue of $5.89 billion.

But its 2013 profit estimate fell short. For this year, Actavis predicted adjusted earnings of between $7.70 and $8.10 per share on about $8.1 billion in revenue.

Analysts expected profit of $8.19 per share on $8.09 billion in revenue.

As part of the name change, the company's New York Stock Exchange ticker symbol switched to "ACT" from "WPI."

The shares, which were inactive in premarket trading Friday, have gained 50 percent in the last 12 months.

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St. Jude Q4 profit, medical device sales decline

ST. PAUL, Minn. -- Troubled medical device maker St. Jude Medical Inc. posted a 4 percent drop in fourth-quarter profit as higher taxes and a drop in sales for most of its products offset tight spending. The company still managed to top Wall Street profit expectations.

The maker of pacemakers, heart-shocking defibrillators and other medical devices has been plagued over the past few years by recalls of wires for several heart devices, and analysts worry another recall could be coming.

The company, based in St. Paul, Minn., said Wednesday that net income was $120 million, or 39 cents per share for the three month-period that ended on Dec. 29, down from $125 million, also 39 cents per share, a year earlier.

Excluding one-time charges totaling 53 cents per share, net income would have been $285 million, or 92 cents per share. The charges include ongoing restructuring charges, litigation costs, an income tax loss related to the settlement of an audit and write-offs for discontinued products.

Analysts surveyed by FactSet were expecting earnings per share of 89 cents, excluding charges.

Revenue totaled $1.37 billion, matching analysts' consensus forecast. Sales were down 2.5 percent, from $1.41 billion in 2011's fourth quarter.

Net income fell despite an 18 percent drop in spending on marketing and administrative expenses, to $451 million.

Sales fell 3 percent to $422 million for the company's best-selling products, heart defibrillators implanted in patients to correct dangerous irregular heartbeats and prevent heart attacks. Pacemaker sales dropped 11 percent, to $260 million.

In the one bright spot in the quarter, sales of products to diagnose and treat the dangerous irregular heartbeat atrial fibrillation increased 10 percent to $239 million.

The company said it expects earnings per share of 91 cents to 93 cents in the first quarter and $3.68 to $3.73 for all of 2013. Those numbers exclude expected restructuring charges.

Last week, analysts said they think the Food and Drug Administration may call for a recall of another heart wire product called Durata. Earlier this month the company said it had received a warning letter from the FDA after agency inspectors found inconsistencies in how the company manufactured and documented defibrillators. The FDA will not allow any new products to be made at the plant making the defibrillators until problems with manufacturing and quality control are fixed.

St. Jude shares lost 5 cents to $39.62 on Wednesday.

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DaVita May Profit From Obamacare Boost: Pro

The Stocks to Benefit From Healthcare Reforms Martin Brunninger, head of Medtech at Nomura tells CNBC what stocks could benefit from President Obama's proposed reforms for US healthcare.

"We have 70 percent of the dialysis care market dominated by two big players, so we have efficiency gains and there's not much more earnings power in the U.S. sector," said Brunninger.

"However moving a bit away from dialysis care, DaVita has diversified away and they have a broader approach now in saving managed dollars for broader patient populations," he added. "I think that is the future."

Last week, Nomura raised DaVita to a "buy" from "neutral," and hiked its price target to $120.

Beginning in 2014, the Obama administration is preparing for an estimated 30 million people to take advantage of its signature health care law. Health care companies are preparing to absorb the countless billions of dollars that will be spent on insurance for lower-income patients.

DaVita, Brunninger said, may become part of the more bullish outlook for health care stocks.

"It's all about changing the structure in the U.S. health care system," he said, adding that most health care systems around the world were moving toward lower spending on an increased population.

"It doesn't necessarily mean the quality needs to be diminished. But it's just about management and where the profits are going," he added.

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