Tokyo: Japanese drugmaker Daiichi Sankyo on Friday raised its annual outlook to reflect a strong turnaround at its Indian arm Ranbaxy Laboratories.
Daiichi raised its recurring profit forecast to ¥100 billion from ¥85 billion for the year to March 2011 but that was still short of the consensus of a ¥118.6 billion profit in a poll of 16 analysts by Thomson Reuters I/B/E/S.
Makers of branded drugs, including Takeda Pharmaceutical and Astellas Pharma as well as global rivals, are struggling to develop strong successors to their mainstay drugs which have lost or are soon set to lose patent protection.
Daiichi’s new flagship drug Effient has so far seen slow sales due to concerns about bleeding risks, yet the product and Ranbaxy have helped to make Daiichi better positioned than its peers, analysts say.
For the first-half, its recurring profit totalled ¥92.7 billion ($1.1 billion), a rise of 77% from the same period a year earlier.
Ranbaxy, India’s top drugmaker, in August posted a fifth straight quarter of profits, sweeping past analyst expectations, thanks to the strong sales of the generic version of GlaxoSmithKlein’s blockbuster herpes treatment Valtrex in the United States.
Daiichi’s results reflect Ranbaxy’s with the timelag of a quarter.
In contrast, Takeda and Astellas have recently been hit by development setbacks and they have not forayed into Japan’s growing generic drug market, although foreign players are rushing in.
Based on the companies’ projections for the year to March, Daiichi is expected to replace Astellas as Japan’s No.2 drugmaker in terms of annual revenues.
Japan’s fourth-biggest drugmaker Eisai on Thursday lifted its annual earnings outlook and posted record April-September revenue and profits, with recurring profit rising 37.5 percent on strong sales of its Alzheimer’s drug and cost cuts.
After the announcement, Daiichi shares were up 1.1% at ¥1,708, outperforming the broader Nikkei benchmark which fell 1.7%.