Eli Lilly & Co. (NYSE: LLY) said Thursday earnings per share could grow more than 10 percent next year, but the drugmaker's stock dipped as its 2009 forecast fell short of Wall Street expectations, according to Associated Press.
Indianapolis-based Lilly also touted its pipeline of drugs under development during a Webcast of its annual meeting with investors in New York. Company leaders said they expect to launch two new medicines per year starting in 2013.
Penny Stock Professor, a leading financial publication, is pleased to alert investors of stocks on the move. Sign Up for our Free Penny Stock Picks.
However, analysts remain unconvinced the company will be able to generate enough revenue to make up for a huge wave of patent expirations looming in a couple years.
Lilly will lose patent protection for its best-selling drug, the antipsychotic Zyprexa, in 2011. Zyprexa generated $4.7 billion in sales last year. In 2013 and 2014, Lilly will lose protection for four drugs that each generated more than $1 billion in annual sales last year. They include the antidepressant Cymbalta, its second-best seller, and the cancer drug Gemzar.
Losing patent protection exposes the drugs to generic competition.
Lilly executives touted potential new drugs in oncology and for Alzheimer's disease during Thursday's meeting. They said their pipeline includes 25 compounds in mid- or late-stage testing. But the drugmaker also went through a product-launch drought of about four years before it launched the blood thinner Effient earlier this year.
These potential drugs must receive regulatory approval before they can be sold. WBB Securities President Steve Brozak said drug companies are "notorious" for not delivering the products they expect. He noted that bigger drug companies like Pfizer (NYSE: PFE) and Merck (NYSE: MRK) have grown through huge acquisitions, a path Lilly shuns.
This leaves analysts in uncharted territory, he said.
In September, Lilly said it would reorganize into five business units and trim 5,500 jobs over two years in a push to cut costs and pick up the pace of drug development.
"All of these actions are part of our strategy to speed valuable medicines to patients," Lilly Chairman and CEO John Lechleiter told analysts Thursday.
The company also said it has trimmed its sales force by 25 percent over the past year. Spokesman Mark Taylor said that was separate from the job cuts announced in September. He declined to say how many sales people were cut.
For 2009, Lilly said it expects earnings per share of between $4.30 to $4.40. Analysts polled by Thomson Reuters expect $4.42 per share.
Lilly expects to earn $4.65 to $4.85 per share next year, which would represent growth of 6 percent to 13 percent compared to its 2009 expectation. Analysts expect earnings of $4.74 per share for 2010.
Lilly shares fell $1.24, or 3.4 percent, to $35.32 in midday trading Thursday. Meanwhile, the Standard & Poor's 500 index rose less than 1 percent.
Follow us on Twitter: http://www.twitter.com/pennystockspro
Sign up for the free Penny Stock Professor newsletter. To subscribe, enter your e-mail address into the frame at the bottom of this press release or visit our website.
About Us
Penny Stock Professor is a leading stock web site that allows investors and interested parties to research stocks that are on the move. We also track small cap companies that are on the brink of a financial breakout. To feature a company on our web site please contact us at the email listed below.
Please click here to read the full disclaimer.
