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MARION CARDIZEM SR SALES APPROACH $ 30 MIL. IN LESS THAN FOUR MONTHS ON MARKET; TOTAL CARDIZEM VOLUME IS $ 584 MIL.; SCHERING REVENUES UP 7% TO $ 805.5 MIL.

Executive Summary

Marion Cardizem SR (sustained release diltiazem) generated fourth quarter sales of $ 10.5 mil. in the fourth quarter of fiscal 1989 (ended June 30) and a total of $ 29.2 mil. for the fiscal year, which includes over $ 18 mil. from the product's initial sell-in in April. Marion reported that physicians were writing more than 100,000 prescriptions per month for Cardizem SR by year's end. The company had predicted that the late fiscal year launch of Cardizem SR would generate sales in the $ 30-$ 35 mil. range. * In its last full quarter and fiscal year before the upcoming merger with Merrell Dow, sales of Marion's primary prescription drug products Cardizem and Carafate continued to fuel sales and earnings growth. Overall sales for the Cardizem line increased 32% to $ 584 mil. in FY 1989 and accounted for nearly 63% of corporate sales. Excluding sales of Cardizem SR, brand volume was approximately $ 555 mil. for the year. Meanwhile, sales of Carafate (sucralfate) increased 35% from FY 1988 to reach $ 218.8 mil., keeping Carafate among the fastest growing anti-ulcer products on the market and contributing nearly a quarter of Marion corporate volume. Total Carafate prescriptions "averaged well over 400,000 per month throughout the quarter and the year," Marion said. Marion's total sales grew 25.4% to $ 260.5 mil. in the last quarter and 23.7% for the fiscal year to $ 930 mil. Net income increased 51.6% for the year to $ 277.4 mil. For the three months, net earnings grew 77.3% to $ 70.5 mil. In the U.S., Rorer's Maalox antacid and Ascriptin Maalox/aspirin OTC products continue to suffer from lower sales, which hampered U.S. sales growth overall, the company noted. However, Rorer cited several prescription drugs as important contributors to domestic sales volume, including the diuretic Lozol, the asthma treatment Azmacort and the Dermik skin care line. Overseas, Rorer had "very strong sales growth," led by the cardio-selective beta-blocker Selectol (celiprolol), the company's osteoporosis calcitonin treatments, and the launch of calcitonin in an intranasal form in Italy, Rorer said. Schering-Plough sales in the second quarter reached $ 805.5 mil., an increase of 7% over the year-earlier period. For the first half of 1989, sales were up 8.8% to $ 1.6 bil. Net income grew consistently in the 20% range for the three- and six-month reporting periods, increasing 19.3% in the second quarter to $ 120.5 mil. and 21.6% to $ 246.2 mil. for the first half. International pharmaceutical sales, instead of increasing only 3% in the second quarter, would have grown about 12% excluding the impact of foreign exchange rate comparisons, Schering-Plough said. Consequently, worldwide pharmaceutical revenues would have risen approximately 16% and corporate sales 11%. Higher European sales were partially offset by "disappointing results" in Latin America, the firm noted. Higher international sales continue to be recorded for its alpha-2 interferon product, Intron A, which is marketed in 38 countries. In addition, post-launch sales of its non-sedating antihistamine Claritin (loratadine) in 16 foreign markets are "stronger than expected," the firm said. An NDA for the prescription antihistamine product is still pending in the U.S. * Schering's domestic pharmaceutical operations climbed 20% in the quarter, led by the Proventil and Theo-Dur asthma products, the cardiovasculars K-Dur and Nitro-Dur, and higher sales of dermatologicals, Schering said. Also having a positive impact on U.S. sales, Schering said, was the introduction of Eulexin (flutamide), a treatment for advanced prostate cancer that was approved by FDA on Jan. 27. Chattem reported an 8% increase in sales to $ 25.5 mil. in the fourth quarter of fiscal 1989 (ended May 31), while net income increased 2.2% to $ 2.5 mil. The fourth quarter bottom line takes into account a $ 405,000 write off "related to the divestitures of Love's fragrances and Quencher cosmetics in prior years," the company noted. For the full fiscal year, Chattem sales grew 8.5% to $ 68.7 mil. accompanied by a 3.5% decline in net income to $ 2.6 mil. For fiscal 1990, Chattem said it "expects to realize an increase in revenues of about 20%" from the acquisitions of Flex-all 454 and Norwich aspirin. Net earnings for the upcoming fiscal year, however, "are expected to decline by about 20% to 25% due to the decision to invest significant advertising and promotion dollars in the national launch of Flex-all 454," the company predicted. Chattem added that it anticipates the two acquisitions "will help to reduce the pronounced seasonality of the consumer products business." Chart omitted.
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