It will get worse before it gets better at

Schering-Plough

(SGP)

.

The drug company warned Monday that second-quarter earnings will be roughly 12 cents a share, 6 cents short of the analyst consensus, and that earnings in the second half may be weaker than the 24 cents a share it expects to post for the year's first six months. Analysts surveyed by Thomson First Call currently expect the company to earn 18 cents a share in the third quarter and 19 cents a share in the fourth.

Schering-Plough's shares tumbled $1.21, or 6%, to $17.85 in the Instinet premarket session.

The company cited competition for its allergy treatment Claritin, which will face even more generic versions in the second half of 2003, and for its hepatitis treatment known as Peg-Intron/Rebetol therapy.

Fred Hassan, who was appointed CEO in April, also announced an organizational restructuring in which its prescription drug business was placed into a single segment to be headed by Carrie Cox, its executive vice president and president of global pharmaceuticals.

"While addressing the company's business situation, we have also been focusing as a top priority on our regulatory, legal and compliance issues," Hassan said. "Based on what I have learned to date, I remain convinced that -- as I outlined in our five-point Action Agenda -- we can stabilize our company, repair it and subsequently launch a turnaround."