Abbott loses sales momentum; shares fall

(Reuters) - Abbott Laboratories Inc Wednesday reported lower-than-expected quarterly sales, hurt by generic competition for its Depakote anti-seizure drug, but one-time gains and demand for stents drove profit higher.

Abbott's traditionally strong sales momentum came to a standstill in the first quarter, as the stronger dollar battered overseas sales and compelled the company to temper its full-year revenue forecast for arthritis drug Humira.

"We're now seeing for the first time the real impact of the economic downturn (on) healthcare," Abbott Chief Executive Miles White told investors in a conference call. But White said Abbott was being "dented" rather than "hammered" by the downturn.

The drugmaker, whose shares fell 4.6 percent, said net income rose to $1.44 billion, or 92 cents per share, from $938 million, or 60 cents per share, a year earlier.

The results included a gain of $797 million after it was released from an obligation to make a payment to longtime partner Takeda Pharmaceutical Co Ltd.

Excluding special items, the company earned 73 cents per shares. Analysts on average expected 70 cents, according to Reuters Estimates.

Global sales fell slightly to $6.72 billion, below the Reuters Estimates forecast of $7.07 billion.

Abbott said a stronger dollar, which reduces the value of overseas sales, crimped total revenue by 6.1 percentage points.

"Most of the sales shortfall came from U.S. pharmaceuticals, led by Humira, reflecting not only weaker markets, but a drawdown in inventories at the wholesaler and pharmacy level," JPMorgan analyst Michael Weinstein said in a research note.

Revenue from one-time blockbuster Depakote plunged by almost two thirds as U.S. doctors began opting for cheaper copycats. Sales of Abbott's Kaletra treatment for HIV were also significantly lower, hurt by new competition.

The revenue trend represents at least a temporary reversal of fortune for Abbott, whose sales jumped 10 percent in the fourth quarter and made the company an industry standout in terms of profit growth.

Despite the new challenges, Abbott said it still expects full-year earnings of $3.65 to $3.70 per share, excluding special items. That would represent profit growth of as much as 11.4 percent over last year.

The suburban Chicago company forecast earnings of 87 cents to 89 cents per share for the second quarter.

Abbott does not need to make major acquisitions to prop up its revenue and profits, White said.

"I don't feel the need to run out and do a deal to sustain what we've promised to shareholders," said White, who noted Abbott will remain "opportunistic" about small and mid-sized deals. Recent reports that Abbott had competed to acquire U.S. drugmaker Wyeth were false, White said.

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