Medco earnings boosted by generic-drug sales
Medco Health Solutions Inc., the biggest U.S. manager of drug benefits, said Friday second-quarter earnings rose 26 percent on sales of higher-profit generic medicines, and the company raised its 2007 forecast.
Net income, beating analysts’ estimates, rose to $214.9 million, or 76 cents a share, from $170.9 million, or 56 cents, a year earlier, the Franklin Lakes-based company said Friday. Revenue rose 4.4 percent, to $11 billion.
Medco, the operator of drug plans for employers, benefited from rising sales of generic versions of Pfizer Inc.’s antidepressant Zoloft and other medicines. Sales of treatments that need special handling and garner higher prices, such as Amgen Inc.’s injected rheumatoid arthritis drug Enbrel, also contributed to growth.
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“Our stronger-than expected results show record high generic dispensing rates,” said Chief Executive Officer David B. Snow in a call to investors. “Generics are a place where the interest of our clients, of Medco, and of our investors are clearly aligned.”
The higher forecast reflects the introductions of new generic versions of two blood-pressure medicines, Pfizer Inc.’s Norvasc and Novartis AG’s Lotrel, said Ricky Goldwasser, an analyst with UBS Investment Research in New York.
Shares of Medco rose 63 cents, to $78.82, in New York Stock Exchange composite trading. The stock has climbed 46 percent this year through Thursday.