Salix results fall short of expectations despite big jump in revenue

08/07/2014 5:15 PM

08/07/2014 5:26 PM

With an assist from its acquisition of specialty drug company Santarus, Salix Pharmaceuticals posted a 62 percent jump in revenue that nonetheless fell short of Wall Street’s expectations.

The Raleigh company reported after the markets closed Thursday that revenue for the second quarter totaled $382 million, up from $235.4 million a year ago. The year-ago results don’t include sales of drugs acquired when Salix purchased Santarus for $2.6 billion at the outset of the year.

Analysts had projected Salix would post revenue of $396.7 million, according to Bloomberg News.

Non-GAAP net income more than doubled to $120 million, or $1.59 per share. Analysts were anticipating $1.70 per share.

CEO Carolyn Logan said in a statement that strong growth in prescriptions for key products was partially offset by inventory adjustments made by wholesalers in the wake of the Santarus acquisition.

Earlier Thursday, Salix shares closed at $133.55, down $4.07. Its shares are up 48 percent this year.

Salix sells drugs to treat gastrointestinal ailments. Its No. 1 drug, Xifaxan, treats travelers’ diarrhea and a rare liver condition.

Salix’s pending merger with Cosmo Pharmaceuticals, a subsidiary of an Italian drug dompany, will significantly lower Salix’s tax rate. The company plans to maintain its headquarters in Raleigh, where it employs 303 workers, after the deal is completed.

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