Actavis Inc., formerly named Watson Pharmaceuticals, said Tuesday that its fourth-quarter earnings fell 70 percent from a year-ago period that got a big boost from the debut of its generic version of the cholesterol fighter Lipitor. Still, results topped expectations and the company backed its outlook for 2013.
Watson recently changed its name to Actavis after completing its $5.6 billion purchase of Swiss drugmaker Actavis Group, which created the third-largest generic drug company in the world.
The newly combined company said Tuesday that it earned $28 million, or 21 cents per share, in the three months that ended Dec. 31. That compares with Watson's profit of $94.8 million, or 75 cents per share, in the final quarter of 2011. Adjusted earnings for the latest fourth quarter fell 10 percent to $1.59 per share.
In 2011, Watson launched an authorized generic version of Lipitor, the world's best-selling drug, under an agreement with Lipitor maker Pfizer Inc. Sales of a generic Lipitor contributed 64 cents to Actavis' earnings in the 2011 quarter compared with just 3 cents in last year's fourth quarter. Several other drugmakers have started selling generic Lipitor since Watson's version debuted. Actavis also said operating costs climbed 26 percent in the latest period to $1.73 billion, due in part to acquisition and integration charges.
The Parsippany, N.J., company's revenue climbed 13 percent to $1.75 billion from $1.54 billion a year earlier, helped by new products in key markets including generic versions of deep vein thrombosis treatment Lovenox, asthma medication Xopenex and ADHD drug Adderall XR in the U.S.
The performance topped Wall Street expectations. Analysts surveyed by FactSet expected, on average, earnings of $1.53 per share on $1.74 billion in revenue.
For the full year, the company earned $97.3 million, or 76 cents per share, as revenue rose 29 percent to $5.91 billion. For 2013, the company reaffirmed a forecast it made last month for adjusted earnings of between $7.70 and $8.10 per share on about $8.1 billion in revenue.
Analysts, on average, expect earnings of $8.03 per share on about $8.1 billion in revenue.
Actavis shares fell 39 cents to $84.85 on Tuesday, while broader trading indexes rose less than 1 percent. The stock is down slightly since closing 2012 at $86.