Teva Pharmaceutical Industries Ltd.'s first quarter earnings climbed 13% as sales of branded drugs that came with the acquisition of Cephalon Inc. increased revenue for the world's largest generic drugmaker.
Its adjusted earnings beat Wall Street estimates but revenue came in short, and its US shares fell 77 cents, or 1.7%, to $43.70 in premarket trading.
The Israeli company said Wednesday that its net income rose to $859 million, or 97 cents per share, in the three months that ended March 31. That compares to net income of $761 million, or 84 cents per share, in the previous year's quarter.
Adjusted earnings were $1.47 per share, excluding things like acquisition and restructuring expenses and a $56 million inventory increase tied to the Cephalon deal.
Revenue rose about 25% to $5.1 billion from $4.08 billion a year ago.
Analysts surveyed by FactSet expected, on average, earnings of $1.44 per share on $5.5 billion in revenue.
Teva is the 10th largest global pharmaceutical company, according to drug data firm IMS Health. Last fall, it completed its $6.8 billion acquisition of the US drugmaker Cephalon, which makes the sleep disorder treatment Provigil and pain drugs like Fentora.
Teva recorded $2.1 billion in branded drug revenue in the first quarter, a 54% increase compared to last year, due largely to the addition of Cephalon products like Provigil, which generated $291 million.
US sales grew 46% to $2.75 billion, helping to offset a 2% decline in Europe. Generic revenues climbed 12% in the quarter to $2.6 billion.
Teva also said CEO Shlomo Yanai was stepping down Wednesday, a move the company first announced in January. Yanai served as CEO for five years, and Teva has said he took the company from a business of mainly generics with $8.4 billion in annual revenue to a more diversified business with anticipated 2012 revenue of $22 billion.
He will be replaced by Dr. Jeremy Levin, a former senior executive at Bristol-Myers Squibb.