Single-Digit Profits Growth For B-MS And W-L

While many of the larger US drug companies have announced double-digit growth in profits in the second quarter of 1996 (Marketletter July 29), two firms, Bristol-Myers Squibb and Warner-Lambert, have posted single-digit growth. In contrast, American Home Products has achieved strong results, as did Schering-Plough.

Alza Corporation said that royalties and fees for the second quarter of 1996 were $47.7 million, up 39.5%. This included a benefit of around $6 million to Alza for the settlement of litigation relating to patent disputes concerning transdermal nicotine patches. Under the terms of the settlement announced in June (Marketletter July 1), Ciba-Geigy made a one-time payment to Hoechst Marion Roussel and Alza, and will pay ongoing royalties shared by both companies on sales of its product Habitrol, retroactive to January 1, 1996.

Sales and profits growth at American Home Products were robust in the 1996 second-quarter and six-month periods. US pharmaceutical sales grew 14% in the quarter, and 7% in the first half. US sales gains were due primarily to introductory sales of Redux (dexfenfluramine) for the management of obesity, Naprelan (naproxen), an arthritis treatment, and higher sales of Premarin (conjugated estrogens) products and Pondimin (fenfluramine). These were offset partially by lower sales of cardiovascular products. International pharmaceutical sales increased 5% for the quarter, and 7% for the first half. Driving international sales were Effexor (venlafaxine), Tazocin (piperacillin/tazobactam) and Zoton (lansoprazole). This was offset by lower sales of Minocin (minocycline) and the unfavorable effect of foreign exchange. Total pharmaceutical sales advanced 5% to $1.7 billion in the second quarter and 2% in the first half to $3.7 billion.