Teva sees API sales surge in Q2

07-Aug-2016 - Last updated on 08-Aug-2016 at 13:40 GMT

Teva sees higher API sales in Q2 (source Google images)

Teva Pharmaceutical Industries has reported higher second quarter API revenue citing a surge in demand from customers in the US and Europe.

Active pharmaceutical ingredient (API) revenue for the three months ended June 30 was $207m (€186m), which is up 13% on the year-earlier quarter.

Teva said increased customer demand in the US and Europe was the main driver, explaining that this had offset lower ingredient sales to customers based elsewhere.

The Israeli firm sells drug actives through its TAPI business which – according to generic medicines division CEO Sigurdur Oli Olafsson – also supplies APIs for 40% of the firm’s non-branded products.

The surge in second quarter drug ingredient sales follows a 25% increase – to $197m – in API revenues in the first quarter of 2016.

Generic revenues down

The API growth was in contrast with the rest of Teva’s generic drug segment, which saw revenue and profit fall 7% and 16%, respectively, to $2.3bn and $614m.

The firm attributed the decline to the loss of exclusivity in the US for certain generics - its versions of Abilify (aripiprazole) and Nexium (esomeprazole) - and lower sales of its versions of Plumicort (budesonide), Xeloda (capecitabine) and Lovaza (omega-3).

Generic drug sales were also down in Europe. Teva cited lower sales in the UK and Germany as the key factors.

Outside the US and Europe, non-branded drug sales increased, climbing 56% to $742m with demand in Canada, Japan and Venezuela leading the growth.

Gross profit for Teva's generic segment was down 11% to $1.1bn. The firm said higher profit of its API business and higher gross profit from European markets had only partially offset the negative impact of increased US competition and higher production costs.

Second quarter results

Teva’s total revenue for the quarter – sales generated by the firm’s generic segment, its specialty medicines business and its over-the-counter (OTC) combined - was $5bn, up 1% on the second quarter last year.

Operating income for the quarter was down, falling to $361m from $662m in the second quarter of 2015 as a result of costs associated with the integration of Allergan’s generic drug business.