Genzyme's Sales Fall Short

Earnings are also below estimates.
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Genzyme

(GENZ)

was getting knocked around Wednesday after the drugmaker's quarterly sales and profits failed to meet analysts' expectations.

While revenue was up 16% in the quarter to $730.8 million, analysts were looking for $749 million, according to Thomson First Call. The Cambridge, Mass., company's shares fell $3.96, or 6%, to $61.82.

Genzyme, which develops and manufactures drugs for rare diseases, saw sales of its Fabry disease treatment Fabrazyme reach $80.5 million, a 15% increase from the year-ago quarter but short of Wall Street estimates of $83 million to $95 million.

Sales for Cerezyme, a drug for Gaucher disease, came in at $239 million for the first quarter, up from $226 million a year ago. Analysts were anticipating sales of $235 million to $245 million. Genzyme has said it expects the drug to make up a smaller proportion of its overall revenue going forward and to show only modest sales growth in the future.

Renagel, a kidney disease drug, had sales of $118.7 million, up 19% from last year and within the range that analysts were estimating, between $115 million and $124 million. Genzyme believes Renagel will benefit for the rest of the year from the implementation of the Medicare prescription drug benefit plan and positive clinical trial data.

The osteoarthritis drug Synvisc brought in $53.3 million for the quarter, up 21% from last year, but lighter than expected. Since sales of the drug are seasonal, Genzyme predicts Synvisc will have solid growth in the second and third quarters.

Genzyme's first-quarter net income was $101 million, or 37 cents a share, including costs of 8 cents a share for expensing stock options. The company earned $95.6 million, or 36 cents a share, last year.

Excluding certain items and the option-related costs, Genzyme would have earned $156.5 million, or 59 cents a share, up from $131.1 million and 51 cents a share last year. Analysts were calling for a profit of 63 cents in the latest quarter.

Even with the lackluster first-quarter results, Genzyme reiterated its full-year revenue guidance of $3.1 billion to $3.3 billion and its per-share earnings forecast of $2.65 to $2.75, before items.