issued third-quarter financial results Tuesday that missed the Wall Street consensus by a penny, but the Swiss drug giant remained optimistic on its goals for 2005.
Daniel Vasella, the chairman and chief executive, said he was "pleased with the overall strong performance." On the basis of the results, he said, "we are confident of achieving our full-year objectives for new record sales and earnings."
Investors were fine with that. Novartis closed up $1.88, or 3.7%, to $53.29 on trading that was four times the average daily volume.
Novartis, the sixth-biggest seller of prescription drugs in the U.S., said it earned $1.67 billion, or 71 cents a share, on revenue of $8.42 billion for the three months ended Sept. 30. For the same period last year, it earned $1.47 billion, or 62 cents a share, with a top line of $7.06 billion. The profit comparison reflects changes in international accounting standards that took effect Jan. 1.
The company's biggest operating unit, prescription drugs, posted a 10% gain in sales and a 20% increase in operating income for the third quarter vs. the same period last year. The consumer health division had 9% more revenue, but operating income slipped 1%.
The Sandoz generic drug unit saw sales double, and operating income nearly tripled, but those figures were affected by the acquisitions of the German generic drug company
in June and the U.S. generic drug company
in July. Novartis said the generic drug additions are "exceeding expectations."
Among individual products, Novartis said worldwide sales of the blood pressure drug Diovan grew by 17% to $925 million, and the leukemia drug Gleevec rose 33% to $547 million. Sales of the breast cancer drug Femara advanced 35% to $136 million.
Zometa, a drug for bone pain caused by cancer, had sales rise 15% to $302 million. The irritable bowel syndrome medication, Zelnorm, climbed 36% to $113 million.