Genzyme posts quarterly profit vs loss

BOSTON (Reuters) - Biotechnology company Genzyme Corp (GENZ.O) reported a fourth-quarter profit on Wednesday, reversing a year-earlier loss, as sales of its drugs for rare diseases increased.

The company posted net income of $78.9 million, or 29 cents a share, compared with a net loss of $268.2 million, or $1.02 a share, a year earlier.

Revenue jumped 21 percent to $1.04 billion, driven by strong sales of its newest drug, Myozyme, a treatment for the muscle disorder Pompe disease.

Earnings excluding acquisition-related charges and stock option compensation were 91 cents a share, a penny below analysts' average forecast, according to Reuters Estimates. Revenue topped the average forecast of $988.7 million.

Cambridge, Massachusetts-based Genzyme said increased operating expenses and decreased interest income associated with a fourth-quarter acquisition reduced its earnings by 1 cent a share.

The company stood by its 2008 earnings forecast of $4.00 a share before one-time items. It forecast net earnings of $2.75 a share and said it expects revenue of $4.5 billion to $4.7 billion.

It expects earnings to rise to about $7.00 a share by 2011 excluding one-time items.

NEW PLANT

Genzyme, one of the world's biggest biotech companies, is waiting for U.S. regulatory approval for an additional plant to supply Myozyme. The plant is already making the drug but has not yet received formal approval.

At present, Genzyme provides approved supplies of Myozyme to the most severely ill younger patients. Supplies from the additional plant are being provided to adult patients free of charge. Once the plant is approved, those adult patients will begin paying for the drug.

The plant is expected to be approved in May, meaning the commercial benefit to Genzyme would likely start showing up in the second half.

The company said the commercial impact of not being able to fully meet demand for the drug will be about 3 cents a share in the first quarter. It forecast first-quarter earnings, before one-time items, in the low 90 cents per share range.

Genzyme is also building additional manufacturing in Belgium which it expects to be up and running next year.

The company said it expects sales of Myozyme to increase to between $320 million and $330 million this year from $201 million last year.

Genzyme's shares were up 90 cents, or 1 percent, to $77.62 in morning trading on Nasdaq.