Sepracor profit up over 700% on cost cuts

US research-based pharmaceutical company Sepracor has increased its net income by over seven times on drastic cost cuts. Shares shot up 16% to  $15.87 on the day of the news, January 29.

Total revenue increased 5% to $1.29 billion and R&D costs were cut by 6%  to $246.8 million. Net income rocketed to $515.1 million, or $4.79 per  share, versus $58.3 million, or $0.55 per share. The firm's cash and  investments totalled $765.8 million on December 31, 2008.

Sepracor announced a strategic corporate restructuring and workforce  reduction plan aimed at cutting future operating expenses, which the  company anticipates will result in a "stronger-performing and more  nimble business," and confirmed its financial guidance for 2009. The  company projects a reduction in operating expenses of about $210.0  million, of which approximately $20.0 million of cost-savings was  realized during the fourth quarter of 2008, with non-GAAP earnings per  share of between $2.10 and $2.70 and revenue of $1.15 billion to $1.25  billion.