US Firms' Strong 1st Qtr Lifts Share Prices

The US pharmaceutical sector's share prices, which have been in the doldrums as investors moved out of defensive stocks into cyclicals, have received a boost as drug companies revealed strong growth in the first quarter of 1996. Double-digit growth has been posted by a number of companies. Johnson & Johnson and Pfizer were particularly strong performers, posting earnings growth of over 20%. In the table below, amounts are expressed in millions, except per share data.

Drug delivery company Alza Corporation performed well in the first quarter of 1996. Royalties and fees were $37.7 million, up 24.4%. The increase was due to sales of Adalat CR (nifedipine), which is marketed in over 30 countries by Bayer AG, and Glucotrol XL (glipizide), which is marketed in the USA by Pfizer. Net sales increased to $20.7 million, up 10.1%. Contributing to this increase was initial shipments of Ethyol (amifostine), used to reduce cumulative kidney toxicity associated with the administration of cisplatin in patients with advanced ovarian cancer or non-small cell lung cancer. The product is copromoted by US Bioscience.

R&D expenditure in the quarter grew 41% to $31.3 million. This was attributed to increased product development activities undertaken on behalf of Therapeutic Discovery Corporation.