Two healthcare giants based in the midlands and the west have this week posted first quarter losses — despite a massive increase in sales in both companies.
Both Boston Scientific and Elan which are large employers in Galway and Athlone registered the losses even though sales of stents and revolutionary druigs respectively were in line with forecasts.
Boston Scientific, the US medical devices firm that employs 4,500 people in Ireland, posted a quarterly net loss after it took on charges relating to a heart stent patent lawsuit, while Elan has reported a pre-tax loss of $88.6m for the first quarter of 2009, an increase on the pre-tax loss figure of $83.4m for the same time last year.
Boston Scientific said sales of its primary product -- coronary stents that prop open clogged arteries -- totalled $489 million in the first quarter, nearly matching sales a year earlier and beating the company's forecasts.
That put Boston Scientific's market share in stents at about 37 per cent, ahead of key competitors Abbott Laboratories, Medtronic Inc, and Johnson & Johnson.
In the market for the fanciest and most profitable stents, which are coated with drugs to keep arteries open, Boston Scientific estimated its market share at 44 per cent.
The company took an after-tax charge of $240 million for patent judgments it expects to have to pay, after a federal appeals court ruled in March that Boston Scientific's heart stents and those made by J&J each infringe patents held by the other company.
The charge, which was announced last week, also included a patent settlement the company reached with a New Jersey radiologist, and is in addition to about $1.1 billion the company has allocated to pay other patent-infringement judgments.
As a result, Boston Scientific said it would lower its guidance for full-year earnings to a range of 46 cents to 57 cents a share. That is down from a range of 56 to 68 cents a share that the company had predicted at the end of January.
In the first quarter, Boston Scientific sold $444 million in implantable defibrillators, up eight per cent, but still below levels in 2005, before a series of recalls and lawsuits hurt the devices' reputation.
Elan has reported a pre-tax loss of $88.6m for the first quarter of 2009, an increase on the pre-tax loss figure of $83.4m for the same time last year.
Revenues rose by 14 per cent to $245.1m from $214.7m mainly as a result of a strong performance from Elan's multiple sclerosis drug Tysabri. This offset reduced sales of its Azactam and Maixpime drugs.
Elan said that revenues from its biopharmaceuticals business grew by 28 per cent in the first three months of 2009, while revenue from Elan's Drug Technologies business decreased by 14 per cent.
Sales of Tysabri increased by 48 per cent to $158.7m during the three month period, up from $107m for the first quarter of 2008. Elan said that by the end of March, about 40,000 patients worldwide were using Tysabri, up six per cent on the figure for December 2008.
Elan said its higher pre-tax losses were due to the higher net charges - including restructuring charges of $22.2m - and research and development expenses. These were partially offset by the increase in revenues and lower net investment losses.
Last February Elan said it was cutting 230 jobs worldwide, including 115 at its Irish operations. The company's CEO Kelly Martin said Elan's strategic review process was continuing.
Boston Scientific, the US medical devices firm that employs 4,500 people in Ireland, posted a quarterly net loss after it took on charges relating to a heart stent patent lawsuit.
The company, which earlier this year announced the closure of its Donegal facility with the loss of 120 jobs, reported a profit in line with analysts' expectations as sales of its closely watched drug-coated stents improved, and the company's shares rose seven percent in after-hours trading.
Stents are small wire-mesh tubes inserted into coronary arteries to prop them open after they have been cleared of blockages.
Boston Scientific reported a first-quarter net loss of $13 million, or one cent a share, compared with a profit of $322 million, or 21 cents a share, in the same period a year ago.
Included in the net results were $240 million of charges related to various patent lawsuits. The company lost an appeal in a patent dispute with rival stent maker Johnson & Johnson. Items related to acquisitions, divestitures and restructuring also hurt the bottom line.
