Jan. 10 (Bloomberg) -- Genentech Inc., the world's second- biggest biotechnology company, said fourth-quarter profit climbed 75 percent, helped by surging sales of a new medicine for vision loss and expanded use of the Avastin cancer drug.

Net income increased to $594 million, or 55 cents a share, from $339.2 million, or 31 cents, a year earlier, the South San Francisco-based company said today in a statement. Sales and profit exceeded analysts' estimates and the company forecast 25 percent to 30 earnings growth, excluding certain costs, in 2007.

U.S. sales of Genentech's newest drug, Lucentis, a treatment for vision-destroying macular degeneration, reached $217 million. Analysts had estimated $159 million in revenue from the eye drug. U.S. sales of the Avastin colon-cancer drug, Genentech's fastest- growing product since its approval in 2004, surged 36 percent to $490 million. Avastin is in testing for 25 types of tumors and won U.S. approval last October as a lung-cancer treatment.

``It was a real solid quarter, more of what's to come,'' Cowen & Co. analyst Eric Schmidt said today in a telephone interview. ``They beat expectations, certainly on Lucentis, Avastin, and the street is pleased with the guidance.''

Genentech was expected to earn 46 cents a share, according to the average estimate of 12 analysts surveyed by Bloomberg. The shares rose as much as $2.26, or 2.7 percent, to $86 in after- hours trading, after closing at $83.74.

Revenue increased to $2.7 billion from $1.89 billion. Analysts had estimated revenue would reach $2.5 billion.

Cancer Drugs

Sales of oncology drugs, which also include Herceptin for breast cancer and Rituxan for non-Hodgkin's lymphoma, make Genentech the biggest U.S. seller of tumor-fighting medicines.

Genentech sells Avastin in the U.S. and receives royalties from Roche for other countries. The Food and Drug Administration cleared sales of Avastin for lung cancer in October, expanding the market for the drug. Michael King, an analyst with Rodman and Renshaw in New York, estimates Avastin sales for lung cancer will reach $396.5 million next year and $1.35 billion by 2010.

The approval in lung cancer ``was the most significant driver of growth during the quarter,'' Ian Clark, Genentech's vice president of commercial operations, said today in a telephone interview.

The company said in September that the FDA delayed clearance to market Avastin for breast cancer by more than a year with a request for further analysis of safety and effectiveness data. Genentech said it may reapply by mid-2007, setting back approval until 2008.

New Kind of Treatment

The medicine was the first cancer treatment to work by blocking the growth of blood vessels that feed tumors and enable them to grow.

Sales of Herceptin rose 29 percent to $322 million. On Nov. 16, the FDA cleared the drug for use at an earlier stage of the disease, targeting localized breast cancer after surgery. The new use is based on data that showed Herceptin and chemotherapy following surgery cut the risk of relapse by more than half among women newly diagnosed with an aggressive form of breast cancer.

U.S. sales of Rituxan increased 16 percent to $560 million.

Among biotechnology companies, Genentech ranks behind only Thousand Oaks, California-based Amgen Inc.

To contact the reporter on this story: Angela Zimm in Boston azimm@bloomberg.net

Last Updated: January 10, 2007 17:48 EST