(Reuters) - Pharmaceutical maker Eli Lilly and Co. said on Friday it expects to increase profits in 2013, primarily due to cost controls and productivity gains off of a much weaker 2012 when sales declined sharply due to competition from cheaper generics.
Lilly also said that 2013 sales will be flat to a bit higher, despite the loss of its patent on the $5 billion a year Cymbalta drug in December 2013.
When patents expire, name brand drug makers' profits plunge as consumers begin buying cheaper generic competitors. Lilly has been battered by the loss of the patent on schizophrenia treatment Zyprexa and will face generic competition for its $1 billion Evista osteoporosis drug in early 2014.
The company said that its revenue would be driven by other drugs for which it still has patents and its animal health products. It said it has 13 drugs in late-stage testing. The company also said it expects significant revenue growth in Japan and the emerging markets, particularly China.
Lilly shares were up in pre-market trading at $51 per share compared to Thursday's close of $49.72.
Lilly said that it expects 2013 earnings to increase to $3.75 to $3.90 per share excluding items from a forecast $3.30 to $3.40 per share in 2012. In 2011, its adjusted earnings were $4.41 per share.
Analysts had expected on average earnings of $3.71 for 2013 and $3.36 per share for all of 2012, according to Thomson Reuters I/B/E/S.
The company said that 2013 net profit would benefit from a tax credit that had been pushed into this year because of the late signing of the American Taxpayer Relief Act of 2012 -- the legislation that prevented the so-called fiscal cliff.
The company said it is not sure yet of the amount of the tax credit, which is related to research and development accounting, and said it would provide more information during its January 29 earnings conference call. Lilly said it has excluded the impact from all of its financial guidance.
Adjusted earnings also exclude payment and income for revenue sharing with Bristol-Myers Squibb Co.'s Amylin unit on Byetta, a diabetes drug, and restructuring charges.
Lilly forecast 2013 revenue of $22.6 billion to $23.4 billion. Analysts are looking for 2012 revenue of $22.42 billion and 2013 revenue of $22.82 billion.
(Reporting By Caroline Humer; Editing by Grant McCool)
Source: http://news.yahoo.com/eli-lilly-banks-cost-controls-higher-2013-profit-134943808--finance.html
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