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Lundbeck losses deepen on EU fine

Pay-for-delay penalty contributes to operating loss of 506m Danish krone

Lundbeck HQ

A 'pay-for-delay' fine levied by the European Commission weighed heavy on Lundbeck's bottom line in the second quarter, although recent product launches boosted revenues.

Lundbeck posted an operating loss of 506m Danish krone ($90m) - more than four times higher than the loss posted in the same period of 2012 - on the back of a fine of 700m Danish krone by the EC for paying drugmakers not to launch generic rivals to its antidepressant Cipralex (citalopram).  Lundbeck disputes the verdict and is planning to appeal.

Second-quarter revenues came in at 3.54bn Danish krone, buoyed by better than expected sales of Cipralex/Lexapro and sales of newer products, which collectively account for around 17 per cent of total group turnover.

Gains in Japan and other markets such as Canada helped Cipralex/ Lexapro to a 4 per cent increase in the second quarter to 1.51bn Danish krone, despite the continuing impact of generic competition in the US (where it is sold by Forest Laboratories).

Among the newer products, Huntington's disease treatment Xenazine (tetrabenazine) climbed by 34 per cent to 372m Danish krone, while Sabril (vigabatrin) for epilepsy was up 62 per cent to 147m Danish krone and Lennox-Gastatut syndrome therapy Onfi (clobazam) brought in 11m Danish krone, up 114 per cent on the prior year.

"Our performance from new products continues to show a solid growth which raises our expectations for the full year result and confirms our strategy for Lundbeck in the long term is well on track," said the firm's chief executive Ulf Wiinberg.

Not all was good news among the new clutch, however, with Lundbeck noting that uptake of Sycrest/ Saphris (asenapine) for treating symptoms associated with bipolar disorder has been "disappointing".

Other recent launches, such as alcoholism therapy Selincro (nalmefene) and depot antipsychotic Abilify Maintena (aripiprazole), are also off to a good start, said the company, although it did not reveal early sales figures.

Turning to its other legacy products, Lundbeck noted that Alzheimer's disease drug Ebixa (memantine) was down 20 per cent to 559m Danish krone on generic competition in Europe, while Azilect (rasagiline) for Parkinson's disease grew 15 per cent to 339m Danish krone.

While Lundbeck is on the path towards removing its reliance on Cipralex with its latest batch of products, analysts believe that the company could face a rocky time unless it can bring much-vaunted new antidepressant Brintellix  (vortioxetine) to market.

Brintellix has already been submitted for approval in the EU and the US (where it will be co-marketed by Takeda) and could achieve sales of $500m within three years of launch, rising to $1.5bn-plus at peak, analysts suggest.

Lundbeck also has two projects in phase III development, namely desmoteplase for ischaemic stroke, which is scheduled for filing in 2014, and Abilify follow-up brexpiprazole.

Article by
Phil Taylor

8th August 2013

From: Sales



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