MedImmune Affirms Year Outlook

The company loses 18 cents a share on sales of $88.5 million in the second quarter.
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Shares of

MedImmune

(MEDI)

slipped Thursday as the biotech company beat Wall Street's bottom-line estimate but fell just short of the revenue prediction.

The Gaithersburg, Md., company lost $44.2 million, or 18 cents a share, on sales of $88.5 million in the second quarter. Analysts polled by Thomson First Call had expected a loss of $51.6 million, or 20 cents a share, on revenue of $99.1 million.

For the same period last year, MedImmune lost $100 million, or 40 cents a share, on revenue of $93.6 million. However, the year-ago loss was affected by a charge related to MedImmune's cancellation of an agreement with

Wyeth

(WYE)

to market FluMist, the nasal spray vaccine. Excluding the charge, MedImmune lost $29 million, or 12 cents a share, in the 2004 second quarter.

The company also reaffirmed its full-year profit prediction of 35 cents to 40 cents. The Thomson First Call consensus is 38 cents. MedImmune's stock closed down 72 cents, or 2.5%, to $27.72.

The second and third quarters are relatively quiet for MedImmune. The company relies heavily on the first and fourth quarters for its major product, Synagis, which prevents a dangerous lung disease in infants and young children called respiratory syncytial virus. For the first half of 2005, Synagis accounted for 87% of the $598 million in corporate sales.

MedImmune also makes CytoGam, which fights infections caused by organ transplants, and Ethyol, which reduces the toxic effects on the kidneys of chemotherapy and eases the dry-mouth side effect of radiation therapy for head and neck cancers.

The next big event for the company will come this fall when MedImmune learns the details of a late-stage clinical trial of an improved version of FluMist. MedImmune must show that this experimental vaccine is as safe as -- and more effective than -- a traditional vaccine so the company can have "an advantage in carving out a niche in the pediatric flu vaccine market," says Alex Hittle of A.G. Edwards.

Hittle, who has a buy rating, told investors in a report Thursday that a successful test could add $1 to $3 a share. The revised version of FluMist is easier to ship and store than the original, which was an expensive disappointment in its debut during the 2003-2004 flu season. Hittle doesn't own shares, but his firm is a market maker in MedImmune's stock.