Genzyme Forced to Restate

Genzyme ( GENZ) said Monday that it was restating its 2003 financial results because of an adverse ruling by a British government agency involving a company drug.

As a result, Genzyme will revise its fourth-quarter GAAP net income to $57.3 million, or 25 cents a share, compared with the first-reported net income of $66.7 million, or 29 cents a share. Fourth-quarter revenue was revised to $476.1 million from $481.2 million.

In addition, the Cambridge, Mass.-based biotechnology company said full-year 2003 income was reduced to $94.3 million, or 42 cents a share, compared with $103.7 million, or 46 cents a share as previously announced. Total revenue was revised downward to $1.574 billion from $1.579 billion.

The revisions were caused by a ruling last week by the U.K.'s Competition Appeal Tribunal regarding a previous decision by that country's Office of Fair Trading. The net result was a fine of $5.4 million plus interest against the company for violating an anticompetition law for selling Cerezyme, a treatment for Gaucher's disease, a rare metabolic disorder that increases a person's risk of anemia, lung problems and kidney disease.

Genzyme was accused of unfair competition by setting up its own health care services to sell the drug.

The announcement of the restatement came after U.S. markets had closed. In regular trading Monday, Genzyme lost $1.87, or 3.8%, to close at $47.12. In after-hours trading, the stock lost another 56 cents, to fall to $46.56.

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