BASF Profits Up But Pharma Growth Down

German chemical and pharmaceutical company BASF has reported a 12.4%increase in pretax profit for the first nine months of 1997 to 3.79 billion Deutschemarks ($2.22 billion), due principally to the strong performances of its chemicals and oil and gas businesses.

Sales excluding oil and gas tax rose 14.8% to 41.55 billion marks, boosted by favorable exchange rates. BASF noted that sales had increased considerably in the health and nutrition segment, jumping 19.4% to 8.45 billion marks, due principally to strong gains in its crop protection business.

Pharma "Unsatisfactory" Jurgen Straube, BASF's chairman, noted that during the third quarter, foreign business was the mainstay of the group's "steady" performance, but growth flattened off domestically "as a result of the unsatisfactory pharmaceutical business." The company said that the general improvement in earnings for the health and nutrition division were not enough to offset charges arising from the Synthroid (levothyroxine) settlement in the USA (Marketletter May 26), for which $138 million was set aside, and market launch costs for three new drugs, including the antiobesity agent Meridia (sibutramine), for which BASF has high hopes once it receives FDA approval.