INDIANAPOLIS (AP) — Eli Lilly’s profit slipped 3 percent in the third quarter and the drugmaker fell well short of Wall Street expectations as competition and a loss of patent protection chopped revenue for some key products.
Company shares started sliding early Tuesday after Lilly also reaffirmed its forecast for 2016 earnings and gave its revenue guidance a slight increase. The company expects adjusted earnings of between $3.50 and $3.60 per share on revenue ranging from $20.8 billion to $21.2 billion.
Analysts expect earnings of $3.59 per share on $21.21 billion in revenue, according to FactSet.
Sales of Lilly’s top seller, the insulin Humalog, and the cancer treatment Alimta both tumbled 9 percent to $640.8 million and $570.4 million respectively. Meanwhile another key seller, the erectile dysfunction drug Cialis, rose only 4 percent to $588.2 million.
Lilly said competition in the United States led to decreased demand for Alimta, which also faced the loss of patent exclusivity in several countries. Lower prices that included changes in rebate and discount estimates helped drop Humalog sales 14 percent in the U.S.
Higher research and development costs and lower investment gains also mixed into the company’s lower-than-expected performance.
Overall, Eli Lilly and Co. earned $778 million in the third quarter. Adjusted results came in at 88 cents per share.
Analysts expected, on average, earnings of 96 cents per share, according to Zacks Investment Research.
Revenue climbed 5 percent to $5.19 billion but still fell short of forecasts.
Four analysts surveyed by Zacks expected $5.35 billion.
Shares of the Indianapolis-based drugmaker fell 1.5 percent, or $1.17, to $76.40 in premarket trading.
Lilly shares had fallen almost 8 percent since the beginning of the year, while the Standard & Poor’s 500 index has climbed slightly more than 5 percent.
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