(By Balachander S) Eli Lilly & Co. (NYSE:LLY) reported a drop in quarterly earnings, as Zyprexa patent expirations drove lower revenue and margins. Yet, the bottom-line topped Wall Street projections and the company raised its full-year forecast.
On a non-GAAP basis, earnings per share (EPS) declined 26 percent to $0.92 from $1.24, but beat market expectations of $0.78 per share.
Net earnings fell 4 percent to $1.01 billion or $0.91 per share for the first quarter from $1.05 billion or $0.95 per share in the year-ago quarter.
Total revenue dropped 4 percent to $5.6 billion, hurt by patent expirations of anti-psychotic drug Zyprexa, yet beat consensus estimate of $5.36 billion.
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Gross margin contracted 1.2 percentage points to 78.6 percent.
Volumes dipped 7 percent due to the loss of patent exclusivity for Zyprexa in most major markets.
Total revenue in the U.S. remained unchanged at $3.085 billion, while falling 9 percent outside the U.S.
Research and development and marketing, selling and administrative increased 2 percent and 3 percent, respectively.
Looking ahead for the full year, the company now expects non-GAAP earnings per share in the range of $3.15 to $3.30 from prior expectations of $3.10 to $3.20. Revenue is still projected to be between $21.8 billion and $22.8 billion. Analysts expect earnings of $3.18 per share on revenue of $22.4 billion.
LLY expects gross margin to be around 77 percent for the year.
The stock, which has been trading between $33.75 and $42.03 over the past year, ended Tuesday's regular trading at $39.96.