Eisai Co. cut its full-year net income forecast by 20 percent because of lower-than-expected sales of the Aricept drug for Alzheimer’s disease, the company’s biggest earnings contributor.
Net income will drop to 47 billion yen ($511 million) in the 12 months ending March 31, Eisai said in a statement today. That compares with the Tokyo-based company’s previous projection of 59 billion yen and 58.5 billion yen reported a year earlier.
Aricept sales will total 97 billion yen for the full year, 15 billion yen less than initially expected, because of weaker sales in Japan, Eisai said. The company also faces competition from cheaper generic drugs in the U.S., the world’s largest pharmaceutical market, since Aricept lost patent protection in November 2010. At its peak in the year ended March 2010, the drug accounted for 40 percent of Eisai’s revenue.
Eisai fell 2.1 percent to 3,915 yen as of 1:32 p.m. in Tokyo trading. Japan’s benchmark Topix index rose 0.7 percent.
The company also cut its forecast for full-year sales by 6 percent to 573.5 billion yen, and reduced its projection for operating profit by 18 percent to 71.5 billion yen.