Genzyme's 4th quarter 2009 earnings plunge due to manufacturing problems for two leading products; expands research in Europe

US biotechnology major Genzyme reported a sharp down turn in profits, due to well-documented manufacturing contamination and supply problems for two of its best-selling drugs - Cerezyme (imiglucerase for injection) and Fabrazyme (agalsidase beta; The Pharma Letters passim), with fourth-quarter 2009 GAAP net income of $23.2 million, or $0.09 per diluted share, compared with $86.7 million, or $0.31 per diluted share, in the same period in 2008.

The company's stock dipped 0.8% to $55.09 on the news early yesterday, but edged up 0.5% on the day, in above-average volume trading.

Non-GAAP net income was $83.5 million, compared with $118.2 million in the fourth quarter of 2008. Non-GAAP earnings were $0.31 per diluted share, compared with $0.42 per diluted share in the prior fourth quarter. GAAP and non-GAAP figures include manufacturing write-offs and amortization, among other items. Non-GAAP net income excludes stock compensation expenses and costs associated with the acquisition of Bayer oncology products.