Eli Lilly is facing a few lean years ahead, but it managed to grow sales during the first quarter. The company's revenue increased by 6 percent on higher sales of several of its key drugs. And thanks to the weaker U.S. dollar, Lilly boosted its sales forecast for the full year. However, profits fell by 15 percent on restructuring and other costs, to $1.06 billion, or 96 cents per share.
"We saw true, volume-driven revenue growth," CFO Derica Rice told the Wall Street Journal, pointing out sales growth in Japan and in its animal-health business. Among the top-performing drugs was the atypical antipsychotic Zyprexa, which grew to $1.28 billion, including a 2 percent increase in the U.S. on price hikes, the WSJ points out. The antidepressant Cymbalta grew by even more, percentage-wise: 13 percent to $908.8 million. Cancer treatment Alimta was up 10 percent, to $579.9 million.
But encoded in Lilly's Q1 results is its leaner future. Zyprexa, which accounts for 22 percent of the company's sales, goes off patent this fall. And sales of its Gemzar cancer treatment show the devastation that can follow when that happens; the drug saw sales drop 46 percent to $156.1 million because it faced generic competition.
Lilly is hoping that the lean times are temporary. Its long-acting diabetes drug Bydureon finally won a recommendation from European regulators last week. One reason profits dropped this quarter is that Lilly agreed to pay $388 million to team up with Boehringer Ingelheim on diabetes drugs, one of which is already under review by regulators. And the company is closing in on its goal of moving 10 drug candidates into late-stage testing by year's end. The latter won't pay off for years to come--but Lilly's betting that if and when they do, the lean times will be over.