CELG Celgene Corporation

By Lisa Beilfuss 

Biopharmaceutical company Celgene Corp. logged better-than-expected revenue growth in its latest quarter, thanks to higher sales of its flagship drug, but earnings fell short of expectations as costs increased.

Shares slipped 2.5% in premarket trading. Through Wednesday's close, the stock had fallen 20% over the past three months.

The Summit, N.J., company, which recently shook up its management slate and named a new chief executive, has been trying to broaden its reach beyond its foothold in drugs treating multiple myeloma. Most of its revenue has come from one drug, Revlimid, but such blood-cancer drugs are aging and rivals are challenging patents.

In the latest quarter, Revlimid sales rose 18% world-wide, powered by growth in the U.S. and roughly matching analysts' expectations. Sales from the flagship drug represented 61% of Celgene's top line. Celgene signaled Thursday that Revlimid sales growth would slow slightly this year, to a rate of 15% from 16% in 2015.

Celgene in the third quarter completed its $7.2 billion acquisition of Receptos Inc. in a bid to move deeper into the multibillion-dollar market for autoimmune diseases. Otezla, Celgene's drug to treat psoriasis, a common autoimmune disease, saw sales nearly quadruple to a better-than-expected $183 million amid market share gains and launches across Europe. Sales of small-cell lung cancer treatment Abraxane rose 15% to $270 million, also slightly better than analysts had anticipated. Those increases offset declines in sales of chemotherapy drug Vidaza and multiple myeloma treatment Thalomid.

Overall, Celgene reported a profit of $561 million, or 69 cents a share, down from $613.9 million, or 74 cents, a year earlier. Excluding acquisition costs, among other items, earnings per share rose to $1.18 from $1.01.

Revenue increased 23% to $2.56 billion. Analysts projected $1.22 of adjusted per-share profit on $2.54 billion in sales, according to Thomson Reuters.

Total costs and expenses in the quarter rose to 64.9% of revenues from 64% in the year-earlier quarter, as research and development spending rose by one-third.

For the current quarter, Celgene expects to earn an adjusted $1.27 to $1.30 a share, up from $1.07 a year earlier. Analysts have projected $1.30 in per-share earnings this year.

Celgene earlier this month offered downbeat sales guidance for the year, predicting $10.5 billion to $11 billion. The company backed that view Thursday.

Write to Lisa Beilfuss at lisa.beilfuss@wsj.com

(END) Dow Jones Newswires

January 28, 2016 08:53 ET (13:53 GMT)

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