Lundbeck's third-quarter sales rise 10 percent; CEO warns of generic impact on future growth

Lundbeck reported Wednesday that third-quarter sales lifted 10 percent year-over-year to 4.3 billion Danish kroner ($669 million), boosted by revenue from Brintellix/Trintellix, Northera, Onfi and Rexulti. In the three-month period, profit reached 876 million kroner ($136 million), up from 320 million kroner ($50 million) in the year-ago quarter.

CEO Anders Gotzsche said "Lundbeck continues the strong growth and we continue to see improvements in the company's profitability and we are on track to deliver the best ever financial result for the company." However, the executive warned "we've already seen the first generic drugs for Sabril and Xenazine and that will drag down future growth."

Regarding individual products, revenue from Onfi jumped 19 percent to 767 million kroner ($119 million), while sales of Northera surged 45 percent versus the year-ago period to 472 million kroner ($73 million). Revenue from Brintellix/Trintellix jumped 43 percent year-over-year to 417 million kroner ($65 million), with sales of Rexulti climbing 38 percent to 337 million kroner ($52 million).

Meanwhile, revenue from Sabril grew by 11 percent to 370 million kroner ($58 million) despite the launch of Endo International's generic version of the therapy in August. Conversely, sales of Xenazine plunged 24 percent to 272 million kroner ($42 million) following the introduction of generic versions of the drug starting in the third quarter of 2015.

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Lundbeck's third-quarter results follow the departure of former CEO Kare Schultz, who was tabbed as Teva's chief executive in August. The drugmaker's board selected Gotzsche as its interim CEO last month.

For the full year, Lundbeck indicated that sales are now expected to between 16.7 billion kroner ($2.6 billion) and 17.5 billion kroner ($2.7 billion), narrowed from prior guidance of 16.9 billion kroner ($2.6 billion) to 17.4 billion kroner ($2.7 billion). Meanwhile, annual earnings are predicted in the range of 4.1 billion kroner ($638 million) to 4.5 billion kroner ($700 million), down from an earlier forecast of 4.3 billion kroner ($669 million) to 4.6 billion kroner ($716 million).

Commenting on the guidance, Martin Munk of Jyske Bank said it was in line with market expectations and not driven by stronger product sales as some investors and analysts had hoped for. Shares in the drugmaker fell as much as 6.8 percent on the news.

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