Wyeth Upbeat About Earnings

Wyeth ( WYE) said Wednesday that several regulatory, research and manufacturing issues won't affect the company's estimated earnings for the year.

In fact, "if current business trends continue," Wyeth could produce full-year earnings per share at the upper end of the previously predicted range of $2.97 to $3.07, the company said after the markets had closed.

The prediction excludes any potential restructuring charges that could result from the company's continuing review of its business processes, Wyeth said. The consensus EPS forecast is $3.08, according to Thomson First Call.

"We expect to deliver on our stated goal of growing earnings at a meaningfully faster rate than revenue," said Robert Essner, chairman and CEO, in a prepared statement.

In regular trading, the stock lost 58 cents, or 1.3%, to close at $43.82. After hours, it lost another 2 cents.

Although the Madison, N.J., drugmaker is scheduled to release second-quarter results on July 20, it decided to inform investors about several recent developments that could affect its future sales and profit. They include a warning from the Food and Drug Administration about its manufacturing practices, additional clinical trials for an experimental antidepressant and a delay in launching a new oral contraceptive.

Wyeth sent a "timely response" to a May 8 warning letter from the FDA that cited problems at a Puerto Rico plant, based on an inspection that was conducted from early November through mid-December. "We are very disappointed to receive this letter from the FDA," said Essner in a telephone conference call with analysts.

The company said it has put a "comprehensive corrective action plan in place and is working with the regional FDA office to determine next steps," adding that it wants to address the agency's concerns as soon as possible.

Over the years, failure to act quickly or effectively on manufacturing problems by some drugmakers has led to the government's seizing products, imposing drastic fines or establishing lengthy monitoring programs. "Failure to make prompt corrections could result in regulatory action without further notice," said the FDA warning letter to Wyeth.

"While it is too early to predict with any assurance how long it will take to resolve these issues, Wyeth believes it is moving in the right direction," the company said. It hopes to settle the matter by the end of the year.

Additionally, Wyeth said it now expects to launch the oral contraceptive Lybrel early next year. In late June, Wyeth received conditional approval from the FDA for this drug, which is the first to eliminate menstrual periods.

The FDA wants more information about clinical trials and added data about manufacturing methods. The agency will convene a panel of experts to review the clinical trials. Wyeth said Wednesday that Lybrel's approval is contingent on the FDA endorsing changes at the Puerto Rico plant.

Wyeth also said it will delay the launch of an experimental depression drug, DVS-233, because it's conducting more clinical tests on a lower-dose version. The additional tests weren't ordered by the FDA, Essner said. Instead, they represent research that had been planned for some time.

The company is testing the drug for other uses, including symptoms of menopause, a form of chronic muscle and bone pain called fibromyalgia and chronic pain caused by damaged or injured nerve fibers.

Wyeth submitted its DVS-233 application for depression to the FDA in December, and company officials said they still expect to hear from the agency in October. However, they won't be able to evaluate the results of the additional clinical tests until early 2007. The company said it plans to launch the drug next year "with those lower-dose data available, subject to the FDA's approval" of Wyeth's application.

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