The Wall Street Journal-20080213-Plavix Sales Brighten Sanofi-s View
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Plavix Sales Brighten Sanofi's View
Full Text (427 words)Sanofi-Aventis SA reported solid growth in fourth-quarter net income and a positive outlook due to job cuts and a court decision that protects its best-selling drug Plavix.
The Paris company, the world's third-largest drug maker by sales after Pfizer Inc. and GlaxoSmithKline PLC, said it expects earnings per share, excluding certain items, to increase 7% this year at constant exchange rates.
The company's results and outlook contrast with those at many big drug companies, which have been reporting weak earnings and forecasting low or falling profits. Competition from generic drugs, tougher safety standards from the Food and Drug Administration and the difficulty of inventing drugs have contributed to lower earnings.
Sanofi-Aventis is benefiting from a recovery in sales of anticlotting drug Plavix, which plummeted in 2006 when the generics company Apotex started selling a low-cost copy of the drug in the U.S. A U.S. court in June barred Apotex from selling further copies until Plavix's patent expires in 2011.
Plavix's full-year U.S. sales rebounded to $4.07 billion from $2.67 billion in 2006. Sanofi-Aventis and Bristol-Myers Squibb Co. sell Plavix jointly and divide the profit. Bristol-Myers books the U.S. sales.
Sanofi-Aventis said net income rose 31% in the fourth quarter, to 753 million euros ($1.09 billion), from 575 million euros a year earlier. The year-earlier results included hefty charges related to the 2004 acquisition of Aventis, as well as other charges.
Sales fell 6% to 6.91 billion euros from 7.36 billion euros a year earlier, hurt by the weak U.S. dollar and generic competition to the sleeping pill Ambien and the cancer drug Eloxatin.
Yesterday, Sanofi-Aventis faced the latest congressional hearing on its handling of a contentious safety study performed before the 2004 FDA approval of the antibiotic Ketek. The House Energy and Commerce Committee's investigations subcommittee has been investigating the drug for more than a year.
FDA investigators testified that predecessor company Aventis Pharmaceuticals knew of problems with the study but didn't properly disclose them to the agency. Douglas Loveland, a special agent at the FDA's criminal-investigation office, said Aventis "should have" known some results were sloppy and fraudulent and that there was a "catastrophic failure" of systems to detect and disclose problems. He said he didn't think he could prove beyond a reasonable doubt that Aventis was aware of fraudulent data.
Paul Herbert Chew, Sanofi-Aventis's president of U.S. research and development, said Aventis had submitted the study results "in good faith," but in retrospect, the company "could have been more proactive" in sharing potential concerns with the FDA.
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Anna Wilde Mathews contributed to this article.
