DOW JONES NEWSWIRES
Forest Laboratories Inc.'s (FRX) fiscal fourth-quarter net
income fell 46%, partly reflecting $170 million the maker of
name-brand and generic drugs set aside in connection with a U.S.
government probe into its marketing practices.
The U.S. Attorney's Office for the District of Massachusetts is
leading an investigation into marketing and promotional practices
for its Lexapro depression treatment, Celexa and Levothroid. Forest
Labs said Tuesday it "continues to cooperate with these
investigations."
Early this month, the Food and Drug Administration warned 14
major pharmaceutical companies, including Forest Labs, about brief
Internet ads that accompany searches on Google and other search
engines, saying the ads were misleading because they didn't include
risk information.
For the period ended March 31, Forest Laboratories reported net
income of $92.8 million, or 31 cents a share, down from $172.8
million, or 55 cents a share, a year earlier. Excluding a 45-cent
charge in connection with the investigation and year-earlier
licensing payments, earnings fell to 76 cents a share from 90
cents.
Revenue fell to $965.5 million from $990.9 million.
Analysts surveyed by Thomson Reuters expected earnings,
excluding items, of 75 cents a share on revenue of $1 billion.
Sales of Forest Labs' two biggest-selling drugs were mixed.
Lexapro had a 5% drop. Namenda, a treatment for Alzheimer's and
dementia, rose 7.7%. Lexapro, which the company sells for Denmark's
H. Lundbeck A/S (HLUKY) in the U.S., accounts for about 60% of
Forest Labs' revenue.
Last month saw the launch of Savella, a drug by Forest Labs and
Cypress Bioscience Inc. (CYPB) to treat fibromyalgia. The product,
which received delayed FDA approval in January, competes with
Pfizer Inc.'s (PFE) Lyrica.
Forest Labs expects fiscal-year earnings of $3.45 to $3.55 a
share, on net revenue of $4.1 billion. Wall Street was looking for
$3.47 and $4.18 billion, respectively.
Shares closed Monday at $22.39 and were inactive premarket.
-By Mike Barris, Dow Jones Newswires; 201-938-5658;
mike.barris@dowjones.com