Forest Laboratories ( FRX) missed earnings estimates for the second quarter of 2008 in light of a license fee but upped its full-year guidance Tuesday. The drugmaker earned 71 cents a share, a 5% decrease from 75 cents a share in the year-ago quarter. Net income decreased 7% to $225.2 million from $241.1 million. Analysts surveyed by Thomson Financial were expecting 74 cents a share on revenue of $931 million. Earnings were affected by a $70 million licensing charge (that equated to 15 cents a share net of tax) to Microbia for the right to co-develop and co-market constipation treatment linaclotide. Research and development expenses increased 82% to $170.7 million during the quarter, including the $70 million licensing charge made in connection with the Microbia agreement. Quarterly revenue increased 8.5% to $919 million from $847 million in the year-ago period. Sales of Lexapro for the treatment of depression and anxiety in adults totaled $559.1 million in the quarter, an increase of 7% from the year-ago period. Sales of Namenda, a treatment for moderate and severe Alzheimer's disease, increased 24% to $192.9 million year over year. Forest said that product wholesalers held less inventory of both Lexapro and Namenda at the end of the September quarter, which negatively impacted combined sales by roughly $18 million.
Looking ahead, the company upped its guidance for the fiscal year ending March 31, 2008, to a range of $3.10 to $3.20 a share as compared to prior guidance of a range of $3.05 to $3.15 -- excluding the $70 million (equal to 15 cents a share net of tax) licensing charge made in connection with the Microbia agreement in both figures. Forest Laboratories said research and development spending is expected to be $530 million excluding the $70 million licensing charge. Shares fell $1.99, or 4.9%, to $38.39 in recent trading.