Drugmaker Bristol-Myers Squibb Co. swung to a third-quarter profit, thanks to a big jump in sales overseas and a low tax rate, versus a year-ago quarter weighed down by a big charge.
The results beat Wall Street expectations. But sales in the U.S., the world's biggest medicine market, rose only 1 percent, to $2 billion.
That's mainly because Bristol-Myers continues to suffer from generic competition to former blockbuster drugs that had brought in billions every year. Those include blood thinner Plavix, the world's second-best-selling drug until cheaper generic versions flooded hit the market in May 2012, and blood pressure drugs Avapro and Avalide.
Double-digit increases in sales of two of the New York-based company's three cancer drugs, three diabetes drugs and Orencia for rheumatoid arthritis, along with smaller increases for its HIV and hepatitis B medicines, boosted total revenue by 9 percent.
But the generic competition has all but wiped out the company's once-booming stable of heart drugs.
Its hope for revitalizing that franchise, anticlotting drug Eliquis, is off to a slow start, with only $41 million in sales in the quarter. Part of a new generation of medicines for preventing heart attacks and strokes, Eliquis — which Bristol-Myers markets with partner Pfizer Inc. — trails heavily advertised rivals Xarelto and Pradaxa. Both hit the market much earlier.
Meanwhile, sales of Bristol's top seller, antipsychotic drug Abilify, dropped 16 percent to $569 million because of a revised revenue-sharing agreement with its marketing partner.
Bristol-Myers said net income was $692 million, or 42 cents per share. A year earlier, it posted a loss of $711 million, or 43 cents per share, due to a $1.83 billion writedown for scrapping an experimental drug.
Excluding $76 million in one-time items, net income would have been 46 cents per share, two cents more than analysts expected.
The New York-based company said revenue totaled $4.07 billion, up from $3.74 billion. Analysts were expecting $4.01 billion.
"Overall, a solid Q3," BernsteinResearch analyst Dr. Timothy Anderson wrote to investors.
Anderson noted Bristol-Myers has developed several important drugs in recent years, particularly Eliquis and melanoma drug Yervoy. But operational expenses are "starting to creep up," he added, and Bristol-Myers has the highest valuation among major U.S. drugmakers, which could discourage investors.
Bristol-Myers confirmed its 2013 profit forecast, for earnings per share of $1.41 to $1.49. It noted the Food and Drug Administration, which previously refused to approve dapagliflozin, its latest diabetes drug, should rule on it in early January, as the company has submitted additional patient testing data.
In premarket trading, Bristol-Myers shares rose 22 cents to $49.95.