April 17, 2019 / 12:08 PM / 3 months ago

Boehringer's operating income flat as integration costs weigh

FRANKFURT (Reuters) - German drugmaker Boehringer Ingelheim reported on Wednesday flat operating income of 3.5 billion euros ($4 billion) for 2018, held back by the costs of integrating the animal medicines business it acquired from Sanofi.

Strong revenue gains from Boeringer’s diabetes drugs were partly offset by declining revenues for its top-selling inhalable lung drug Spiriva, under pressure from rival drugs. As a result, total group sales fell 3 percent last year to 17.5 billion euros ($19.8 billion), the family-owned group said. It is Germany’s biggest drugmaker after Bayer.

Sales of Spiriva continued to fall after the drug’s patent protection expired, and dropped by a currency-adjusted 11 percent in 2018 to 2.4 billion euros.

Boehringer’s diabetics drugs business - which is in a long-term alliance with U.S. pharma group Eli Lilly - saw a much stronger performance. Revenues from its Jardiance product family jumped by more than half to 1.8 billion euros and revenues from the Trajenta pill rose 9 percent, both adjusted for currency swings.

Boehringer said it was targeting a slight increase in 2019 group sales.

Full-year extraordinary costs, mainly due to restructuring and integration costs at Boehringer’s animal health division, increased last year to 420 million euros, from 309 million in 2017.

The division was boosted by the 2017 acquisition of Sanofi’s veterinary medicine business and saw revenues increase by a currency-adjusted 5.6 percent in 2018 to 4 billion euros, accounting for 23 per cent of Boehringer’s total group revenues.

($1 = 0.8843 euros)

Reporting by Ludwig Burger; Editing by Susan Fenton

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