said Tuesday it was exiting the brand-name drug business to concentrate on its generic drug and drug technology activities.
Shares of the Ft. Lauderdale, Fla.-based company rose 71 cents, or 3.3%, to $22.31 after the announcement that Andrx has hired Banc of America Securities to seek offers for the brand-name drugs.
Thomas P. Rice, the company's CEO, said the decision was made by the board of directors and top management to "focus on our core competencies," which include making controlled-release versions of existing drugs and distributing drugs.
Andrx said its brand-name drug business incurred $31 million in operating losses for the first nine months of 2004. The company said it expects to continue losing money on its brand-name division. Andrx earned $68.1 million from operations for the nine months ended Sept. 30.
Andrx belongs to a group of companies known as specialty pharmaceuticals, which often combine generic products, drug development technology, brand-name drugs and pharmaceutical services. Although brand-name drugs can provide higher profit margins than generic drugs, these products also require greater marketing and development expenses. In Andrx's case, having a division "with a limited number of products" no longer made economic sense, the company said.