Sanofi-Aventis reported a 10 percent increase in fourth quarter net profit Wednesday as strong sales of its swine flu vaccine drove full year earnings above expectations.
France's largest drug maker said net profit rose to 1.8 billion euros ($2.5 billion) in the three months ending Dec. 31 from 1.63 billion euros a year earlier.
The company, whose Sanofi Pasteur division is the world's biggest vaccines manufacturer, said the fourth quarter performance was lifted by a record rise — 64.6 percent — in revenue from its human vaccines business.
Sales of 100 million doses of pandemic vaccines last year helped lift earnings per share on an adjusted basis by 13.1 percent at constant exchange rates, above the 11 percent target Sanofi-Aventis had set in October.
Chief Executive Christopher Viehbacher, who took the reins at Sanofi-Aventis early last year, said in a statement that "major steps have already been achieved in strengthening our growth platforms and reinforcing our R&D pipeline while delivering a double-digit EPS growth."
Since taking the helm, Viehbacher has led a program to help the company take on generic competition and replace aging blockbuster drugs with new treatments.
The company spent euro6.6 billion last year in 33 new partnerships and acquisitions, including Chattanooga, Tenn.-based consumer healthcare products maker Chattem Inc. and Brisbane, California-based biopharmaceutical company BiPar Sciences.
Sanofi-Aventis is also narrowing its research focus to fewer disease areas, something top competitors including Pfizer Inc. and Merck & Co. have already done.
Sales of what Sanofi-Aventis calls its eight "flagship" drugs slid 8.6 percent in the fourth quarter, as generic competition nearly wiped out sales of its Eloxatin cancer treatment, and also hurt its Plavix blood thinner.
For the full year, Sanofi-Aventis' net profit grew 18 percent to 8.5 billion euros, on sales of 29.3 billion euros.
By 2013, Sanofi-Aventis aims to be less dependent on the classical patent-protected blockbusters such as Plavix and Lovenox, as the company leans more heavily on five markets where it sees the most growth: vaccines, diabetes products, emerging markets, over the counter medicines, Japan, and new treatments.
Sanofi-Aventis shares rose 21 percent in 2009, but have slid back 6 percent since the start of the year as stock markets have become more volatile in recent weeks on over the strength and sustainability of the global economic recovery.
Sanofi-Aventis shares fell 0.2 percent to 52.59 euros in early tradinng Wednesday.
The French drug maker's earnings were "roughly in line with what we expected, driven by the swine flu vaccine," said Dominic Valder, pharmaceutical industry analyst at Evolution Securities in London.
"Their forecast for 2-5 percent earnings per share growth this year is what we have in our numbers already, but these might go up on dollar appreciation," Valder added.
Last year Sanofi-Aventis' revenue in the United States rose 2.8 percent to euro9.4 billion.
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