Celgene said Thursday alongside its third-quarter financial results that it expects sales this year to be approximately $13 billion, revised down from an earlier estimate of between $13 billion and $13.4 billion. The company added that sales this year of Otezla are predicted to be approximately $1.25 billion, cut from a previous forecast of $1.5 billion to $1.7 billion. Shares in the drugmaker fell as much as 19 percent on the news.
CEO Mark J. Alles explained "our 2017 forecast assumptions did not adequately anticipate the deep and persistent slowing growth of the psoriatic arthritis and psoriasis markets, especially during the entire third quarter." The company noted that the slowdown was due to controls in managed care, competitive dynamics and challenges in the US dermatology market. Alles suggested that the issues will likely pressure Otezla sales growth in the near-term.
Alles added "in consideration of certain market dynamics and recent pipeline events, we are updating our 2020 outlook." Celgene indicated that in 2020, it now expects total product sales in the range of $19 billion to $20 billion, down from an earlier estimate of over $21 billion. The drugmaker indicated in 2015 that it hoped to double revenue to $20 billion by 2020.
For the third quarter, Celgene said that revenue rose 10 percent year-over-year to $3.3 billion, missing analyst estimates of $3.4 billion. Meanwhile, net income in the three-month period reached $988 million, up from $171 million in the same quarter of 2016.
In the quarter, sales of Revlimid jumped 10 percent to $2.1 billion, coming in above analyst estimates, while revenue from Otezla lifted 12 percent to $308 million, missing analyst predictions of $411 million. The drugmaker indicated that US sales of Otezla were affected by increases in gross-to-net adjustments for contracts inked in January, as well as challenges in market access.
Regarding other products, Pomalyst/Imnovid revenue rose 22 percent year-over-year to $417 million, while sales of Abraxane increased by about 8 percent to $251 million. Meanwhile, sales of Vidaza totalled $151 million, down slightly from $154 million in the year-ago quarter.
Alles said the company is "very disappointed with the results of the quarter." In addition, Celgene indicated that for the current year, earnings per share are expected to be between $7.30 and $7.35, with the lower end of the range lifted from $7.25. Analysts expect annual earnings of $7.31 per share.
Last week, Celgene announced that it will discontinue both the Phase III REVOLVE trial testing its investigational oral antisense therapy mongersen in Crohn's disease, as well as the SUSTAIN extension trial, on the recommendation of a data monitoring committee following a recent interim futility analysis. For related analysis, see ViewPoints: Celgene's big swing and miss on mongersen ups the ante on ozanimod.
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