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Pharma & Bio Ingredients
In the 2004 quarter, when Schering-Plough took a $807 million charge for taxes on overseas profits returned to the United States, the drugmaker posted a loss of $856 million.
Schering-Plough, whose profits plunged three years ago after the patent expired on its Claritin allergy drug and manufacturing problems crimped production of its drugs, said its long-promised turnaround is well underway.
"We are moving from survive mode into thrive mode," said Chief Executive Fred Hassan, referring to the company's fourth consecutive quarter of profit.
Hassan said the company has completed all significant steps needed to fix longstanding quality-control problems at its plants, although the FDA must still certify the improvements.
"It was like we were still changing our tires, while driving down the road," Hassan said, referring to the costly upgrades of quality-control systems at its plants in New Jersey and Puerto Rico.
Hassan, who took charge of the company in 2003, is also fighting to keep demand growing for its treatments for hepatitis C amid competition from Roche Holding AG's (ROG.VX) rival medicines.
Separately, Schering-Plough said the FDA has agreed to review on an expedited basis its experimental new treatment for hepatitis C, called SCH 503034, which works through a new mechanism of action.
Total company sales rose 6 percent in the quarter to $2.32 billion, fueled by growth of Peg-Intron for hepatitis C, arthritis drug Remicade, allergy drug Nasonex and Temodar for brain cancer.
Although total company sales were below Anderson's forecast of $2.4 billion, he said its profit margin of 64.9 percent beat his 64 percent estimate and that company expenses were slightly below his expectations.
Schering-Plough sells two medicines -- cholesterol fighters Zetia and Vytorin -- through a joint venture with Merck & Co. Inc. Global combined sales of the relatively new cholesterol drugs rose 89 percent to $755 million. If Schering-Plough included its approximate half-share in revenues from the partnership, quarterly sales would have risen 13 percent to $2.7 billion.
The company cautioned that Zetia and Vytorin will likely face tougher competition later this year as cheaper generic forms of Merck's widely used cholesterol fighter Zocor and Bristol-Myers Squibb Co.'s Pravachol become available in the U.S.
