Abbott Laboratories said Wednesday that its first-quarter earnings rose 44 percent, fueled by strong sales growth of its blockbuster anti-inflammatory drug Humira, diagnostic devices and nutritional products.
The North Chicago-based health care company beat Wall Street expectations and raised its 2012 adjusted-earnings forecast.
Abbott also reaffirmed that it remains on track to split the company by the end of the year, creating a new pharmaceutical company called AbbVie.
Abbott said it earned $1.24 billion, or 78 cents per share, in the first quarter, up from $864 million, or 55 cents a share, in the same quarter a year earlier. Revenue rose 4.6 percent, to $9.46 billion.
Excluding one-time items, including charges related to its collaboration with Belgium-based Galapagos NV to develop an anti-arthritis drug, Abbott earned $1.03 a share, beating Wall Street’s expectation of $1 a share.
Shares of Abbott stock finished up 3 cents at $60.49.
“There’s very little to quibble with; it’s a solid performance,” said Richard Purkiss, an analyst at Atlantic Equities, citing Humira’s sales and surprisingly strong growth for Abbott’s nutritional products and diagnostic brands in the quarter.
The company plans to reveal further details of its spinoff by the end of June. The split will separate Abbott’s diversified medical products business, which will retain the Abbott name and sell a range of products, from heart stents to baby formula and generic drugs, from its portfolio of proprietary drugs, including Humira.
Sales of the new firm’s dominant drug Humira jumped 17 percent, to $1.9 billion, in the quarter, positioning it to overtake Pfizer Inc.’s cholesterol medication Lipitor as the world’s top-selling drug this year.
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Despite Humira’s robust growth, the drug is facing competitive threats, including possible cheaper generic versions of the injected drug and a new type of pill being developed by Pfizer.
Humira is due to lose patent protection in 2017 in the United States and in 2018 in international markets. But it is somewhat protected from generic rivals because it is grown in living cells and, therefore, is difficult to manufacture. The U.S. Food and Drug Administration has yet to set firm rules on how it will determine whether to approve generic versions of the drug.
But it could face a significant threat from Pfizer’s experimental drug tofacitinib, which blocks a protein called JAK and could be approved in the United States as early as August. As a pill, the Pfizer drug would likely be far cheaper than Humira and appeal to foreign governments intent on controlling medical costs, Purkiss said.
“A cheaper oral alternative, that more than anything is the risk” to Humira, the analyst said.
Abbott in February signed a deal worth up to $1.35 billion to acquire a competing pill-based drug from Galapagos.
The company has said that drug, which is in an earlier stage of development, shows more promise than the rival treatment from Pfizer because it is more targeted and has fewer side effects.
Reuters contributed.
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