Cencora beats quarterly profit estimates on specialty drug demand
Nov 2 (Reuters) - Drug distributor Cencora reported a fourth-quarter profit on Thursday that beat analysts' estimates as strong demand for costly specialty medicines helped offset a decline in COVID-related drug sales.
Cencora has been benefiting from sales of specialty drugs - medicines that treat complex diseases including cancer and rheumatoid arthritis - as prices of generic medicines keep falling due to intense competition.
Rival McKesson Corp raised its annual profit forecast on Wednesday, banking on strong demand for specialty medicines.
Cencora, which makes a major chunk of its revenue from its U.S.-focused business, said revenue from the unit was boosted by increased demand for newer diabetes drugs belonging to the GLP-1 class also used as weight-loss treatments.
Its U.S. healthcare solutions unit brought in sales of $61.9 billion in the fourth quarter, up 13% from a year earlier.
Total sales came in at $68.9 billion, and topped analysts' average estimate of $66.02 billion.
On an adjusted basis, Cencora reported a profit of $2.86 per share, beating analysts' estimates of $2.8, according to LSEG data.
The company also gave an initial outlook for fiscal year 2024, saying it does not now expect a material contribution from COVID-related products beyond the first quarter.
On an adjusted basis, Cencora said it expects 2024 adjusted earnings in the range of $12.70 to $13.00 per share. Analysts were expecting 2024 adjusted profit of $12.79 per share, according to LSEG data. (Reporting by Mariam Sunny in Bengaluru; Editing by Saumyadeb Chakrabarty)
