* Hikma shares lifted by strong operating profit
* Race is on to launch generic versions of Advair
* Generics business expanded by acquisition last year
(Adds comments from CFO, shares)
By Arathy S Nair
March 15 Drugmaker Hikma Pharmaceuticals Plc
posted higher than expected full-year profit thanks to
higher margins and said it expects profitability in its growing
generics drugs business to improve significantly this year.
Shares in Hikma, which makes and markets branded and
non-branded generic and injectable drugs and is listed on the
FTSE 100 in London, rose as much as 9 percent to 2317 pence and
was the top gainer on the index.
"We expect the profitability of the generics business to
significantly improve in 2017, driven by new product launches,
an enhanced mix of sales and a continued focus on operating
efficiencies," the Jordan-based company said in a statement.
Hikma, which bought Boehringer Ingelheim's U.S. generic
drugs business last year maintained its expectation of $800
million in revenue from the generics business in 2017, in line
with a reduced forecast it made in November. Overall, the group
expects $2.2 billion in revenue in 2017.
Pricing for the generics industry has been going down in the
single-digit range but this has been offset by bringing new,
high-value products to the market, Chief Financial Officer
Khalid Nabilsi told Reuters.
The industry focus is currently on Advair, used for
treatment of asthma and chronic obstructive pulmonary disease.
Mylan could have the first substitutable generic
version of GlaxoSmithKline's Advair available in the
United States, assuming regulators approve its product by a
target date of March 28, 2017.
A rival version from Hikma and Vectura is hot on its
heels, with an approval date of May 10.
New launches, primarily Advair, are expected to contribute
about 15 percent of the generics revenue in 2017, said Hikma.
Core operating profit rose to $419 million for the year
ended Dec. 31 from $409 million, helped by strong growth in its
injectables business. Analysts on average had estimated
operating profit of $375 million and noted the positive impact
of improved margins.
(Reporting by Arathy S Nair in Bengaluru; Editing by Keith