World's top 15 pharmaceutical giants have registered significant growth in bottom lines and sales during the first nine months of 2006 and they are likely achieve a growth rate of 23 to 25 per cent in the whole of 2006. The net profit of 15 companies in the nine months ended September 2006 increased by 23 per cent to $ 64,531 million from $52,460 million in the corresponding period of last year. Their net sales also moved up 9.1 per cent to $324011 million from $ 297103 million. Almost all the companies have estimated better earning per share for the year full year 2006.
The PHARMABIZ sample of 15 global companies namely Pfizer, GlaxoSmithKline, Novartis, Sanofi-Aventis, AstraZeneca, Roche, Johnson & Johnson, Merck & Co, Bayer Group, Bristol-Myers Squibb, Wyeth, Eli Lilly, Amgen, Abbott and Baxter International posted growth of 10.3 per cent in pharmaceutical sales during the first nine months of 2006. Their pharmaceutical sales touched to $ 268589 millions as against $ 243435 million in the similar period of last year. The pharmaceutical sales of 15 companies in the US improved by 11.7 per cent to $ 135266 million as compared to $ 121099 million in the last period.
Pfizer remained on top with net sales of $ 35,768 million during the first nine months of the year 2006, registering only a nominal growth of 2.6 per cent over the same period of last year. Its Pharmaceutical sales increased by just 2.5 per cent to $ 33,417 million from $ 32,617 million mainly due to stiff competition from generics in the key markets and pricing environments in European markets. GlaxoSmithKline (GSK) climbed to second spot among the 15 companies with Pharmaceutical sales of $ 27,980 million during the nine months period ended September 2006. The company registered a strong sales growth of 17.1 per cent in the world market and 25 per cent in US market. Its pharmaceutical sales in USA increased to $14,499 from $11,608 million in the first nine months of the preceding year.
There is neck-to-neck competition for the third spot which gone to Novartis with worldwide pharmaceutical sales of $26,967 million in the first nine months of 2006 as compared to $23,555 million in the last period. Sanofi-aventis recorded pharma sales of $26,665 million as against $24,685 million with ranking at fourth spot. Novartis pushed its US sales by 20.5 per cent to $10951 million and sanofi by 7.9 per cent to $9,268 million in the first nine months of 2006. AstraZeneca maintained its position at fifth number with world wide pharma sales of $19321 million as compared to $17,664 million in the last period.
Among the 15 companies, Abbott and Bristol-Myers Squibb suffered setback and their net sales as well as net profit declined during the first nine months of 2006. The net sales of Abbott and Bristol-Myers Squibb declined by 1.2 per cent and 3.4 per cent to $8,859 million and $13,701 million respectively during the period under review. The relatively weaker US dollar put pressure on working.
The net profit of 15 companies increased by 23 per cent mainly on account significant growth by Pfizer of 84.8 per cent, Eli Lilly 97.8 per cent, Baxter International 45.3 per cent and estimated growth in Roche of about 41.2 per cent. Pfizer has reduced its cost drastically including R&D expenditure during the first nine months and managed to pushed its net profit to $9,888 million from $5352 million in the last period. Eli Lilly's net profit jumped to $2,530 million from $1,279 million. Pfizer's, CEO Jeffrey Kindler pointed out that the company is taking a comprehensive look a its costs, and in 2007 it plans to implement a new company-wide cost-reduction initiative to lower cost base in 2007 and 2008.
Eli Lilly's new products like Alimta, Byetta, Cialis, Cymbalta, Forteo, etc pushed sales collectively by 45 per cent to $960 mill in during the first nine months of 2006, accounted 25 per cent of total sales. The company also acquired ICOS Corporation for a consideration of $2.1 billion during the third quarter.
The R&D expenditure of 15 international pharma companies, excluding Roche, increased by 11.4 per cent to $43,056 million in the first nine months of 2006 as compared to $38,639 million in the similar period of last year. Except Pfizer, all other companies pushed R&D expenditure during the period under review. Pfizer cut down its R&D expenditure to $5,700 million from $6,939 million as cost cutting measure.
There are 58 blockbuster products with net sales of over one billion dollar during the first nine months of 2006. There total sales reached at $118406 million as compared to $104517 million in the corresponding period of last year. 11 new products entered the new list of blockbuster during the first nine months. Pfizer has highest number of blockbuster of 8 products in the list of 58 products, followed by GSK and sanofi-aventis 7 products each, Roche 6 products and AstraZeneca 5 products.
Liptor, the top-selling product in the world pharma market, remained at No 1 position with sales of $9,551 million in the first three quarter of 2006 as against $8,829 million in the last period, a growth of 8.2 per cent. GSK's Seretide/Advair maintained its second position with sales of $4,590 million as compared to $3,794 million. There is a huge gap between the first and second largest product. The sales of Roche's product Tamiflu surged almost by 95 per cent to $1304 million from $669 million in the last period. Similarly, its Avastin product saw a strong growth of 97 per cent and touched to $1,704 million from $867 million and entered into the blockbuster list.
The sales of Pfizer's Viagra declined to $1,207 million from $1,215 million during the period under review. Further its sales of Zoloft also declined to $1,944 million from $2,448 million. The sales of few important blockbusters like Plavix and Pravachol (Bristol-Myers), Zocor and Fosamax (Merck), Eprex/Praocrit and Floxin/Levaquiin (Johnson & Johnson) and Losec/Prilosec (AstraZeneca) declined during the first nine months of 2006 as compared to corresponding period of last year.
Despite stiff competition from generics, lower spending on healthcare by several European countries and lower than expected outcome from R&D expenditure, the international companies achieved stronger growth during the first nine months of 2006 These companies projected higher earning per share for the full year 2006. The earning per share (EPS) of GSK improved by 21 per cent during first nine months and anticipated a growth of 12 per cent for the full year. Eli Lilly projected EPS of $3.10-3.20 for 2006 and AstraZeneca raised its 2006 EPS guidance to $3.85-3.95. Merck also forecasted EPs of $2.48 to $2.52 as against earlier predication of $2.18 to $2.25. Pfizer projected its EPS at $1.63 for 2006 and likely to pay higher dividend.
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