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Genzyme Corp's (GENZ) third-quarter net income more than quadrupled on strong product sales as it recovers from major manufacturing and regulatory problems, while warding off a hostile takeover approach from Sanofi-Aventis SA (SAN.FR SNY).

The results from the Cambidge, Mass., biotech missed analyst estimates, and it narrowed fourth-quarter earnings projections to the lower end of its previous view. The company said its manufacturing recovery is on track and continues to work on ending shortages of its top-selling products.

Shares of Genzyme rose 49 cents to $72.38 ahead of the company's 11 a.m. ET earnings conference call. Sanford Bernstein analyst Geoffrey Porges said investors are likely encouraged by the manufacturing update and the company's fourth-quarter sales projections for its top products.

The results come as Genzyme has repeatedly rejected an $18.5 billion takover offer, now hostile, from France's Sanofi. Genzyme has shunned the bid, amounting to $69 a share, as too low and refused to negotiate.

Genzyme is holding a meeting Friday with investors and analysts to provide 2011 financial guidance and make its case that the offer doesn't adequately value its existing business, its recovery plans or its pipeline products.

Genzyme's business has been damaged by manufacturing and regulatory problems in recent years, leading to the long-term regulatory oversight, called a consent decree, of its main Allston, Mass., production facility. It also has made major changes to its board and started a restructuring plan that includes job cuts and shedding noncore businesses.

Genzyme said Wednesday that it is on schedule to meet the November consent-decree deadlines for ceasing the final stage of production at its Allston, Mass., plant for products sold in the U.S. It has transferred "a significant portion" of the work to an Ireland facility and is moving the remainder to Hospira Inc. (HSP).

A new manufacturing facility in Framingham, Mass., that is important to the long-term supply of its drugs is already operational, the company said. Food and Drug Administration approval of the site is still expected in late 2011. Expanded operations at its Ireland location are expected to get approval in the second half of 2011.

The company reiterated its previous projection for having full global supply of Gaucher's disease treatment Cerezyme by year-end. It has continued increasing the supply of Fabry disease drug Fabrazyme in the U.S. and will return to full supply everywhere in the first half of 2011.

Third-quarter sales of Cerezyme nearly doubled to $179.8 million reflecting increasing shipments. Fabrazyme sales dropped to $33.9 million from $115.2 million because of the shortage.

Genzyme projected fourth-quarter Cerezyme revenue of $235 million to $245 million and Fabrazyme revenue of $70 million to $75 million.

Sales of Pompe disease treatments Myozyme and Lumizyme rose 24% to $106.2 million, reflecting the recent U.S. launch of Lumizyme.

For the three months ended Sept. 30, Genzyme reported a profit of $69 million, or 26 cents a share, down from $16 million, or 6 cents a share, a year earlier. Excluding items, per-share earnings were 42 cents, far below analyst estimates of 50 cents.

Revenue rose 8.4% to $1 billion, also below expectations of $1.08 billion.

The company's year-ago results were revised to exclude the genetics and diagnostics businesses, which the company is planning to divest by the end of this year.

For the fourth quarter, the company now expects adjusted per-share earnings between 90 cents and 95 cents, narrowed from a previous view of 90 cents to $1. Wall Street analysts are projecting 88 cents a share.

-By Thomas Gryta, Dow Jones Newswires; 212-416-2169; thomas.gryta@dowjones.com

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