Allergan Inc.’s deep-rooted eye drugs are holding their own in a company where breast implants and wrinkle removers have grabbed most of the attention of late.
The Irvine drug maker’s first-quarter sales for glaucoma and other eye treatments, which make up some 50% of the company’s sales, were up 11% to $403 million.
“Our core business, ophthalmology, just continues to move along very well,” said David Pyott, Allergan’s chief executive. “Over the last five years, it’s typically been growing in the mid-teens,most companies would kill for that as well, right?”
Allergan, which vies with Broadcom Corp. for the title of Orange County’s most valuable company, got its start in 1950 with allergy eye drops.
More recently, blockbuster wrinkle remover Botox and early 2006’s $3.2 billion buy of Santa Barbara-based Inamed Corp., which brought breast implants and a wrinkle smoother, have stolen the thunder.
Analysts still like Allergan’s eye drugs.
“While the eye care pharmaceuticals business has faced a recent increase in peer and generic competition, we believe with several eye care products in the pipeline and two anticipated to receive approval in 2008, growth should continue to be at least 11% through 2008,” said Frank Pinkerton, an analyst with Banc of America Securities.
Allergan’s eye drug sales were up 16% to $1.5 billion in 2006 from a year earlier.
Other analysts see eye drugs playing second fiddle to Allergan’s medical cosmetic products.
Restasis, Allergan’s dry eye treatment, Lumigan, a glaucoma drug, and even Botox “will likely take a back seat again,” said Elliot Wilbur and Katherine Lu of CIBC World Markets.
Allergan’s big push is coming from wrinkle smoother Juv & #233;derm and silicone breast implants acquired from Inamed, the analysts said.
Eye drugs are getting their share of attention, according to Pyott.
“For the fifth year in a row, Allergan grew faster than any other (eye drug) company in the world,” Pyott said, citing data from IMS Health Inc., a Norwalk, Conn.-based market researcher.
Allergan overtook Pfizer Inc. in eye drug sales in last year’s third quarter and widened that lead in the fourth quarter, Pyott said.
“And in the fourth quarter, for the first time ever, we became the No. 1 company in Asia outside Japan,” he said.
Allergan licenses eye drugs to companies in Japan, including Senju Pharmaceutical Co., which has the license for Lumigan.
New Products
New products have boosted the eye business.
Those include Optive, an artificial tear that came out at the end of January.
Optive, Pyott said, “has the fastest kickoff rate we’ve ever seen for an artificial tear in Allergan. In fact, Allergan is the company that’s gaining the most share in the artificial tear business.”
The company also makes Refresh, a bellwether artificial tear brand.
Lumigan and Allergan’s other glaucoma drugs, including Alphagan P and Combigan, also are doing well, Pyott said.
The company’s also seen a boost from Ganfort, a combination of Lumigan and beta-blocker timolol, which launched in Europe.
Restasis, Allergan’s drop to relieve dry eyes, also saw a 19% sales hike in the quarter.
Pyott said he expects Allergan to work toward getting Combigan approved in the U.S. and Lumigan in Japan.
Combigan received an approval letter from the Food and Drug Administration in December, but regulators asked Allergan for an additional confirmatory study to answer questions.
“Hopefully, we can have another shot at getting that one approved at the year end,” he said.
Lumigan X, a new version of Lumigan, should be approved around the middle of 2008, according to Pyott.
Coming out with new versions of products to blunt generic competition is key for Allergan, analyst Pinkerton said.
On a first-quarter conference call, Pyott said the drug maker’s next frontier is retinal disease.
An experimental treatment for broken blood vessels of the retina could be launched in two years and gain annual sales of $500 million, he said.
The company’s eye pipeline also includes memantine, a glaucoma pill that could be the first to preserve vision, according to Scott Whitcup, Allergan’s executive vice president of research and development.
Memantine is moving along in trials.
