Watson swings to profit of $38.4M in 4th qtr

The USA's Watson Pharmaceuticals' net revenue for the fourth quarter of 2007 was $627.3 million versus $621.2 million in the comparable period the year before, as and net income grew to $38.4 million, or $0.34 per diluted share, from a loss of $488.9 million and $4.80 per share.

Within Watson's biggest segment, generic pharmaceuticals, sales decreased $69.0 million to $343.7 million in the period, primarily due to the loss of income from painkiller oxycodone HCl controlled-release tablets, though this was offset by new product launches in 2007 of the antidepressant bupropion HCl extended-release 300mg, fentanyl transdermal painkiller patch and Tilia Fe. Other revenue increased $21.5 million to $30.2 million, due to the addition of royalties from Sandoz's sales of metoprolol succinate extended-release tablets 50mg, a generic version of AstraZeneca's beta blocker Toprol-XL, and UK drug major GlaxoSmithKline's sales of Wellbutrin (bupropion) XLP 150mg. Gross margin for the business increased from 29% to 40% in the fourth quarter of 2007, thanks to increases in other revenue, an improvement in product mix and enhanced operational efficiencies, Watson stated.

The downturn was also seen in the firm's branded segment, where sales fell 3% to $94.1 million, primarily due to lower sales of iron replacement product INFeD and Ferrlecit (sodium gluconate) for the treatment of iron deficiency anemia in adults and in pediatric patients undergoing chronic hemodialysis who are receiving supplemental epoetin therapy. Other revenue increased $5.5 million to $15.2 million, due to greater turnover from the co-promotion of AndroGel (testosterone gel) for hypogonadism and other products.