Roche's Chugai Pharma of Japan FY net profit drops 28 pct on drug price cut |
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Wed, 07 Feb 2007 09:30
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TOKYO (AFX) - Chugai Pharmaceutical Co Ltd, a 50.6 pct-owned unit of Roche Holding AG, said its 2006 net profit dropped 28 pct from the previous year after the Japanese government ordered cuts in ethical drug prices here.Chugai made a net profit of 38.4 bln yen, down from 53.6 bln a year earlier.Operating income fell 26 pct to 58.3 bln yen and revenue dipped 0.3 pct to 326.1 bln as prices of its prescription drugs dropped an average 7.5 pct following the official drug price cut here.For instance, it said sales of its Epogin, a treatment drug for anemia associated with end-stage renal disease, fell to 63.4 bln yen in 2006, down 11.7 pct from a year earlier.The company also attributed the lower profit margin for 2006 to sluggish demand for its anti-influenza drug Tamiflu as flu outbreaks eased.General sales of Tamiflu dropped 61 pct to 13.6 bln yen, while sales to the government for stockpiling purposes, which offers a lower profit margin, surged to 24.4 bln yen from 200 mln yen a year earlier.For 2007, Chugai forecasts a further decline in net profit to 31 bln yen, with operating profit seen at 52.5 bln on sales of 332 bln, as it projects a 48 pct drop in Tamiflu sales to 7.0 bln yen.But some analysts pointed to the possibility of an upward revision of its profit forecasts, noting that Chugai did not include sales of Avastin, a new type of colon cancer drug, in its 2007 projections.Chugai lodged a new drug application for Avastin with the Japanese government last year.Avastin was developed by Genetech Inc of the US and fights colon cancer by preventing the growth of blood vessels that carry nutrients to cancerous cells. The Roche group has been marketing the drug since 2004.(1 usd = 120.41 yen)yasuhiko.seki@xfn.comxfnys/xfnzr
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Pharmaceuticals and chemicals highlights to 09:10 GMT 