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Lilly tops estimates despite shrinking Cymbalta sales

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Eli Lilly and Co., which is projected to hit a six-year low point in sales this year, on Thursday reported fourth-quarter profit that beat analysts’ estimates, as sales gains in other products blunted a decline for its top-seller, Cymbalta.

Earnings excluding one-time items were 74 cents a share. Analysts expected 73 cents a share, the average of 12 estimates compiled by Bloomberg.

Sales fell 2 percent, to $5.81 billion, compared with the $5.46 billion analysts projected. The company is bracing for declining revenue this year as top-selling treatments for pain and schizophrenia have lost market share to cheaper generic medicines.

“We haven’t wasted the crisis as the old saying goes,” said CEO John Lechleiter. “We’re more agile. We’re leaner. I think we’re better operators today. And I believe that will help,” he said on a conference call discussing results.

The company’s push in diabetes -- where it plans to have a drug in every therapeutic category -- is a large part of its effort to get sales growing again. Generic copycats eviscerated revenue from products such as osteoporosis treatment Evista and Zyprexa for schizophrenia, and Cymbalta, a pain medicine.

Cymbalta lost patent protection in December, and fourth- quarter sales fell 38 percent, to $883 million, from a year earlier. Revenue from treatments for diabetes and erectile dysfunction helped make up for that loss.

Profit declined 12 percent, to $727.5 million, or 67 cents a share, from $827.2 million, or 74 cents, a year earlier, the company said.

The drugmaker isn’t interested in a large merger or acquisition to build sales, Lechleiter said. “On the pharma side, we continue to have no appetite for large-scale M&A,” he said.

Lilly fell 1.3 percent, to $53.22 each, Thursday morning. The shares have struggled over the last 12 months, gaining 3 percent, compared with a 20-percent increase in the Standard & Poor’s 500 Pharmaceuticals Index.

“The stock had been in the doldrums for a number of years, partly because of the lack of anything new coming from the pipeline and partly because of its extensive ’patent cliff,’” said Timothy Anderson, an analyst with Sanford C. Bernstein & Co., in an investment note.

Investors should still be wary even with the increased sales of some products, said Alex Arfaei, an analyst with BMO Capital Markets Corp. who has an underperform rating on the stock.

“While the top-line performance seems impressive, we believe it should be interpreted with caution because it was primarily dependent on price increases in the U.S. and some wholesale buying patterns,’ Arfaei said in a note to clients. ‘‘We continue to believe that such pricing leverage is not sustainable.’’

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  1. In reality, Lilly is maintaining profit by cutting costs such as Indiana/US citizen IT workers by a significant amount with their Tata Indian consulting connection, increasing Indian H1B's at Lillys Indiana locations significantly and offshoring to India high paying Indiana jobs to cut costs and increase profit at the expense of U.S. workers.

  2. I think perhaps there is legal precedence here in that the laws were intended for family farms, not pig processing plants on a huge scale. There has to be a way to squash this judges judgment and overrule her dumb judgement. Perhaps she should be required to live in one of those neighbors houses for a month next to the farm to see how she likes it. She is there to protect the people, not the corporations.

  3. http://www.omafra.gov.on.ca/english/engineer/facts/03-111.htm Corporate farms are not farms, they are indeed factories on a huge scale. The amount of waste and unhealthy smells are environmentally unsafe. If they want to do this, they should be forced to buy a boundary around their farm at a premium price to the homeowners and landowners that have to eat, sleep, and live in a cesspool of pig smells. Imagine living in a house that smells like a restroom all the time. Does the state really believe they should take the side of these corporate farms and not protect Indiana citizens. Perhaps justifiable they should force all the management of the farms to live on the farm itself and not live probably far away from there. Would be interesting to investigate the housing locations of those working at and managing the corporate farms.

  4. downtown in the same area as O'malia's. 350 E New York. Not sure that another one could survive. I agree a Target is needed d'town. Downtown Philly even had a 3 story Kmart for its downtown residents.

  5. Indy-area residents... most of you have no idea how AMAZING Aurelio's is. South of Chicago was a cool pizza place... but it pales in comparison to the heavenly thin crust Aurelio's pizza. Their deep dish is pretty good too. My waistline is expanding just thinking about this!

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