Earnings season got under way with two big pharma names reporting second-quarter results, Johnson & Johnson
. For J&J, consumer recalls weighed on the company, which reduced 2010 guidance by 15 cents to $4.65-$4.75. The reduction was larger than anticipated, noted Credit Suisse analyst Catherine Arnold, owing to J&J's US troubles (it announced manufacturing problems at a third plant today after having recalled OTC meds at two plants and closed one already). With less Tylenol and Motrin on store shelves, the company also missed revenue targets in its consumer unit, as well as in its medical devices & diagnostics division. But worldwide pharma revenues rose 1% to $5.6 billion, and currency rates bumped quarterly sales up .6% overall.
As for Novartis, the Swiss company raised financial guidance to mid- to high-single-digits (excluding Alcon) after what Bernstein analyst Tim Anderson called a “decent” second quarter: diluted “core” EPS clocked in at $1.20, missing a Bernstein estimate but up 14%, and overall revenues were higher than expected, up 11% to $11.7 billion, with recently launched products (such as Lucentis, Exelon Patch and Tekturna) accounting for 21% ($2.4 billion) of total sales. Among its divisions, vaccines and diagnostics led gains (+135% to $600 million), including $200 million in H1N1 pandemic vaccine sales, while oncology, the largest franchise, was led by growth of Gleevec/Glivec ($1.1 billion, +8%). Follow-on cancer product Tasigna's sales were up 73% to $89 million, a closely watched number as the company will seek to switch patients prior to 2015 when Novartis is set to lose Gleevec to generics. The pending acquisition of Alcon, as well as Gilenia/ FTY720—an oral therapy for multiple sclerosis which was unanimously recommended for approval by an FDA advisory committee and may launch in October—promise to shore up revenue through 2015.
Sepracor will be rebranded as Sunovion Pharmaceuticals. The Marlborough, MA-based company was acquired by Dainippon Sumitomo Pharma Co. in October, and the new name will be official this October. The name change is meant “to foster a sense of unity for our combined US operations,” said Dainippon Sumitomo president Masayo Tada. Dainippon Sumitomo's US operations were folded into Sepracor following the acquisition.