Actavis posts first-quarter loss on acquisition charges

Actavis said Thursday that it posted a first-quarter loss of $102.8 million, versus a profit of $54.8 million in the year-ago period, as the drugmaker recorded acquisition charges of $270 million. The results represent the first full quarter since Watson Pharmaceuticals completed its 4.3-billion euro ($5.6 billion) acquisition of Actavis, with the combined company operating under the Actavis name.

"The new Actavis is off to a strong start in 2013, and as a result, we are increasing our 2013 forecast based on the strong performance and execution against our objectives to date," remarked CEO Paul Bisaro. For 2013, the company lifted its forecast for earnings per share by 40 cents to a range of $8.10 to $8.50, on revenue of approximately $8.1 billion. Analysts expect the company to report profit of $8.09 per share on sales of $8.1 billion. Bisaro noted that the earnings forecast represents 35 percent to 42 percent growth over 2012.

Sales in the three-month period reached $1.9 billion, up 24 percent versus the same quarter of 2012, although the figure fell just below analyst expectations of nearly $2 billion. Actavis reported product sales of $1.5 billion for the quarter, versus $1.1 billion in the year-ago quarter, and attributed the increase to the acquisition of Actavis. Bisaro indicated that Actavis "launched a number of new products in the US during the quarter, including a generic version of Suboxone sublingual tablets and in April launched an authorised generic version of Zovirax."

Bisaro added that the company "also announced patent settlements for generic versions of Crestor, Exalgo, Ziana, Zyclara, Intuniv and the abuse deterrent version of OxyContin." Under the settlement with Purdue Pharma, Actavis is allowed to market fixed quantities of a generic version of OxyContin beginning January 1, 2014, and it will be allowed to market an authorised generic version of the painkiller beginning October 2014 if it fails to win FDA approval for its generic product by September 1, 2014. Earlier this week, the company also purchased the rights to Valeant Pharmaceuticals' bacterial vaginosis treatment Metronidazole gel for approximately $55 million.

Recent reports have suggested that Valeant has been in discussions with Actavis about a possible $13-billion takeover of the company, although the talks have stalled over the value of the deal. Bisaro declined to comment on the speculation, but noted that Actavis routinely evaluates a variety of deals including acquisitions and mergers.

To read more Top Story articles, click here.