Eli Lilly posts 3Q loss on Zyprexa settlement
Posted by Administrator (admin) on Oct 25 2008 at 6:59 AM
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INDIANAPOLIS (AP) – Eli Lilly and Co. Thursday announced its third-quarter profit was wiped out by the amount it has booked for the settlement of charges against the top-selling drug Zyprexa.

The company said it has booked $1.48 billion to settle the charges. However, the company’s adjusted earnings still beat Wall Street expectations.

According to Eli Lilly, it lost $465.6 million, or 43 cents per share. In the same quarter, it had earned $926.3 million last year.

Lilly earned $1.04 per share excluding charges that included around $1.5 billion for the settlement. Its sales increased 14 percent to $5.21 billion from $4.59 billion.

Analysts were anticipating a profit of $1.02 per share and revenue of $5.09 billion, excluding the payment.

The U.S. patent supporting Zyprexa is scheduled to expire in 2011. Revenue from the drug is likely to fall sharply after generic version is introduced. 

Zyprexa is an effective brain tranquilizer. It can calm hallucinations associated with schizophrenia and bipolar mania. But, some internal Lilly documents and e-mail messages show Lilly marketed Zyprexa off-label.  Legally, ppharmaceutical companies are only allowed to market and advertise drugs for those uses specified on the drug’s label.  It is illegal to market medications off-label.

Zyprexa may cause potentially severe weight gain and an increase in blood sugar.  According to the American Diabetes Association, Zyprexa is more likely to cause diabetes than majority of other medicines for schizophrenia and bipolar disorder.

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