GENENTECH ACTIVASE THIRD QUARTER VOLUME RISES NEARLY 50% TO $43.6 MIL; PHARMAKINETICS TAKES $393,000 LOSS ON EXPENSES FROM GENERIC INVESTIGATION
Genentech Activase (TPA) volume in the third quarter climbed nearly 50% to $43.6 mil., compared to sales of $29.1 mil. in the same period of 1988. However, the company noted, quarterly Activase sales were lower than in the previous three months. Second quarter TPA revenues totaled $48 mil., or over $4 mil. more than third quarter sales. Nonetheless, Genentech continues to project a 1989 sales increase for Activase of 20%-25%, putting full-year sales of the thrombolytic agent at $180-$190 mil. TPA sales in 1988 totaled $151.4 mil. "We continue to be on target for meeting our goal of increasing sales 20-25% this year," Genentech CEO Robert Swanson said. Third quarter sales of Genentech's recombinant human growth hormone, Protropin, were $4 mil. ahead of last year, an increase of 14.1%. Genentech net product sales climbed 32.2% in the quarter to $76 mil., while total revenues for the three-month period were $100 mil., up 22.6% from the same period a year ago. Through nine months, Genentech revenues of $289 mil. were up 17.8%. Genentech reported net earnings of $11.4 mil., up 115%, in the third quarter. However, net earnings for nine months are off 21% at $28.4 mil. The biotech firm noted that its third quarter marketing, general and administrative expenses of $32.1 mil. were 18% higher due to a bigger sales force. R&D costs were also up nearly $2 mil. in the quarter because of increased clinical trial expenditures. Since June, three new products have entered Phase I testing: the blood-clot inhibiting agent Argatroban; CD4-IgG for AIDS; and IGF-1, insulin-like growth factor. The contract drug testing firm Pharmakinetics Labs reported Oct. 25 that it took a $393,493 loss in the first quarter of fiscal 1990 (ended Sept. 30) due to expenses associated with the generic drug investigation. The loss includes actual expenses of $206,000 in the quarter and a provision of $350,000 more for anticipated expenses, Pharmakinetics said. The company stated in a press release that although the HHS Inspector General said "the company is not a target of any type of investigation, continued expenses associated with the company's cooperation will be incurred." Contributing to the loss were "reduced R&D expenditures by generic clients and under-performance by the Clinical Trials Division, both of which are primarily attributable to the industry disruption," the company asserted. Pharmakinetics contract revenues jumped 27% to $6.7 mil. in the quarter. The company attributed the increase to the inclusion of revenue from the West German firm International Bio Research, "which is performing ahead of expectations." Commenting on the sales and earnings results, President and CEO Steven Woodman stated: "Despite this continued short-term decline in demand from the generic industry segment of our business, we are continuing to see gains in our brandname and European business segments." Woodman said that the company's long-term future "remains unchanged. The anticipated increases in regulatory and testing requirements for both new and generic drugs should be positive for the company in the long term." Chart omitted.
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