Genzyme Beats, Holds to Lowered Guidance

Genzyme (GENZ Quote) delivered a second-quarter earnings beat Wednesday, surpassing revenue expectations and edging past adjusted profit targets.

But Wall Street found untouched guidance and an overhang in the larger scale production of Pompe disease treatment Myozyme to be offsetting. Shares of the Cambridge, Mass.-based biotechnology company, which specializes in drugs for rare diseases, gave up $2.75, or 3.5%, to $76.56 in recent trading.

Genzyme reported profit of $69.6 million, or 25 cents a share, vs. $83.8 million, or 31 cents a share, in the year-ago period.

Factoring out the fee it paid to Isis Pharmaceuticals (ISIS Quote) to license cholesterol drug Mipomersen, Genzyme said it earned $268.5 million, or 98 cents a share, up from $238.7 million, or 88 cents a share, a year prior.

Genzyme's top line increased 25% to $1.171 billion from $933.4 million a year prior.

Analyst surveyed by Thomson Financial had expected earnings of 97 cents a share on revenue of $1.13 billlion.

The company reported sales of $169 million from Renagel, falling shy of the $173 million consensus. However, sales of the company's lysosomal storage disorder drugs, Cerezyme, Fabrazyme and Myozyme all came in above expectations.

Sales of Gaucher disease treatment Cerezyme and Fabry disease treatment Fabrazyme came in at $319 million and $127 million, vs. the Street expectations of roughly $309 million and $122 million, respectively. Sales of Myozyme also beat, generating $77 million in revenue vs. expectations for $69 million.

Genzyme noted in its release that the Myozyme launch has been more rapid than any of its other treatments for lysosomal storage disorders, and that the rise in revenue came despite the delay in approval of the 2000L-scale production of the drug, which has constrained U.S. sales.