Lilly's 2nd-qtr rise hides coming challenges

US drug major Eli Lilly has reported solid financial results for the second quarter of 2008, but still decreased its financial guidance due to plant closure and staff lay-offs in preparation for the loss of patent for key drug, Zyprexa (olanzapine).

The firm's net income for the period from April 1 through June 30 rose 44% on the same period in 2007, reaching $958.8 million, or $0.88 per share. Worldwide sales increased 11% to $5.8 billion. Turnover for products that were launched this decade collectively grew by 21% to $1.8 billion and accounted for 35% of total revenues versus 32% for the second quarter of 2007.

Nonetheless, Lilly has decreased its financial guidance for the full-year 2008. The firm put this down to the strength of foreign currencies, but Global Insight analyst Gaelle Marinoni claimed the change was due to projected costs to be incurred for factory shut downs and staff redundancies.