Strong Earnings Continue At Major US Drug Firms

As the Marketletter reported last week, most of the major USpharmaceutical companies have announced strong sales and double-digit earnings growth. Merck & Co confirmed this trend, but Warner-Lambert's growth last year was in low single digits.

Allegiance, which has been spun off from Baxter International, has announced its first set of results as an independent company. The decline in sales in the 1996 fourth-quarter and full-year reporting periods were said to be consistent with the firm's efforts to reduce sales of lower-margin products. The firm took a net one-time charge in the 1996 fourth quarter and full year of $612.8 million. Excluding one-time charges, fourth-quarter net income was $17.3 million, or 32 cents, compared with pro forma net income of $11.6 million or 21 cents in the like, year-earlier period. For the full year excluding one-time charges, pro forma net income was $63.1 million, compared with $63.9 million in 1995, and earnings per share were $1.15 compared with $1.16.

Allergan's chief executive and chairman, William Shepherd, said that the firm has taken a number of significant actions to build value for the future. "We continue to build value for the customer through leading-edge health care technology...we achieved internal research and development milestones and established new external business collaborations with two leading biotechnology companies, Sugen and Cambridge NeuroScience," he said.