Vertex Posts 4Q Profit on Growing Incivek Sales

From Associated Press (February 2, 2012)

CAMBRIDGE, Mass. -- Drugmaker Vertex Pharmaceuticals Inc. said Thursday it turned a profit in the fourth quarter on sales of its hepatitis C pill Incivek, which was approved in May.

Vertex reported a profit of $158.6 million, or 74 cents per share. In the fourth quarter of 2010 it lost $180.4 million, or 90 cents per share. Its revenue surged to $563.3 million from $65.5 million a year earlier. That total included $456.8 million in Incivek revenue, and a $65 million milestone payment from Mitsubishi Tanabe Pharma, which is marketing the drug in Japan.

Analysts were forecasting a profit of 72 cents per share and $518.2 million in revenue, according to estimates compiled by FactSet.

The Food and Drug Administration approved Incivek in May, and Vertex reported $420 million in sales of the drug during the third quarter. Incivek and Merck and Co.'s drug Victrelis were the first breakthrough hepatitis C treatments approved in about 20 years, but other drug companies are developing treatments that have shown higher cure rates in studies so far than Victrelis and Incivek, and which might allow for simpler treatment regimens.

Hepatitis C is a chronic infection that can cause liver damage, cirrhosis, liver failure, or cancer. About 4 million Americans are believed to have the virus, and drug companies and analysts expect strong sales of hepatitis C drugs as the baby boom generation ages, more cases are diagnosed, and treatments improve. The virus is the main cause of liver transplants in the United States.

On Wednesday regulators approved Vertex's drug Kalydeco, a treatment for cystic fibrosis. The disease causes thick mucus buildup in the lungs. Vertex is also studying other treatments for hepatitis C, cystic fibrosis, inflammatory diseases, and epilepsy.

In 2011 Vertex posted a profit of $29.6 million, or 14 cents per share, after taking a loss of $754.6 million, or $3.77 per share, in 2010. Its revenue rose to $1.41 billion from $143.4 million.

Vertex Pharmaceuticals stock gained 55 cents to $38.38 in Thursday trading, and rose $1.62, or 4.2 percent, to $40 aftermarket.

Posted: February 2012


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