Eli Lilly and Company has received major setback during the second quarter ended June 2014 due to the impact of changes in price, foreign exchange rates and, patent expirations for Cymbalta and Evista. Its net earnings declined sharply by 39.1 per cent to $ 734 million from $1,206 million in the corresponding period of last year on lower sales. Its net sales declined by 16.8 per cent to $4,936 crore from $5,930 crore. Its revenue in US declined by 30 per cent to $2,380 million. However, revenues outside US increased by one per cent to $2,556 million.
Eli Lilly's R&D expenditure also declined by 10.2 per cent to $1,195 million from $1,330 million. With lower profits, EPS worked out to $0.68 as against $1.11 in the last period.
Dr John C Lechleiter, chairman, said, “Lilly's second-quarter results reflect a substantial decline in revenue and earnings resulting from recent patent expirations. At the same time, new product approvals and impending launches give us great confidence that Lilly is poised for growth in the year ahead. We have stayed the course with our innovation-based strategy, replenishing and advancing our pipeline. We remain firm in our commitment to sustain and accelerate a flow of important new medicines that make life better for people around the world.”
The company launched Cyramza in the US as a single-agent treatment for patients with advanced or metastatic gastric cancer or gastroesophageal junction adenocarcinoma with disease progression on or after prior fluoropyrimidine – or plaltinum-containing chemotherapy. The company completed the acquisition of Lohmann Animal Health effective April 30, 2014.
For the first half ended June 2014, Eli Lilly's net sales declined by 16.6 per cent to $9,619 million from $11,532 million in the similar period of last year. Its net profit declined sharply by 47 per cent to $1,461 million from $2,754 million. R&D expenditure declined by 14 per cent to $2,305 million from $2,679 million. Sales of Alimat and Humalog improved by 4 per cent and 7 per cent to $1,344 million and $1,350 million respectively. However, sales of Cymbalta declined by 69 per cent to $880 million from $2,825 million. And that of Evista declined by 50 per cent to $258 million from $519 million.
The company still anticipates 2014 revenue of between $19.4 billion and $20 billion. The EPS is expected to be in the range of $2.67 to $2.75 on a reported basis.