06 Mar The world's leading biotech companies
There is an overwhelming perspective on the biotech industry that says it has yet to make any money and that it continues to pump billions of research dollars without any return. As we all know by now, biotech stocks, in general, don’t normally trade on earnings like Big Pharma companies; they trade on the promise of novel technology and products.
While the 2005 sales and earning results are still not out for many companies, let’s take a look at the sales (and earnings) of the leading biotech companies from 2004 which can be revealing.
Leading Biotech Companies, $ Millions (Med AdNews, July, 2005)
| Company/Rank | Sales | % Change | Earnings/(Losses) | % Change |
| 1. Amgen | $10,550 | +26% | $2,363 | +5% |
| 2. Genentech | $4,621 | +40% | $785 | +39% |
| 3. Serono | $2,458 | +22% | $494 | +27% |
| 4. Biogen Idec* | $2,212 | +226% | $25 | >999% |
| 5. Genzyme | $2,201 | +28% | $87 | >999% |
| 6. Chiron** | $1,723 | <2%> | $79 | <65%> |
| 7. Gilead Sciences | $1,325 | +53% | $449 | >999% |
| 8. CSL | $1,273 | +40% | $152 | 210% |
| 9. MedImmune | $1,141 | +8% | <$4> | <999%> |
| 10. Cephalon | $1,015 | +42% | <$74> | <999%> |
| Top 10 Companies | $28,519 | +33% | $4,356 | +59% |
| 11. Millenium Pharmaceuticals | $448 | +3% | <$252> | +92% |
| 12. Genencor International | $410 | +7% | $26 | +13% |
| 13. ImClone Systems | $389 | +380% | $114 | >999% |
| 14. Actelion | $380 | +54% | $70 | >999% |
| 15. Celgene | $378 | +39% | $53 | +104% |
| 16. MGI Pharma | $196 | +300% | <$86> | <28%> |
| 17. QLT | $186 | +27% | <$166> | <999%> |
| 18. Nabi BioPharmaceuticals | $180 | +2% | <$50> | <88%> |
| 19. AEterna Zentaris | $179 | +40% | <$4> | +425% |
| 20. Regeneron Pharmaceuticals | $174 | 200% | $42 | >999% |
| 21. Enzon Pharmaceuticals | $170 | +16% | $2 | <96%> |
| 22. Ligand Pharmaceuticals | $169 | +20% | NA | |
| 23. Berna Biotech | $165 | <20%> | <$19> | <999%> |
| 24. Acambis | $157 | <49%> | $36 | <45%> |
| 25. Intermune | $151 | <2%> | <$59> | +65% |
| Next 15 Companies | $3,732 | +27% | <$293> | NA |
| Top 25 Companies | $32,251 | +32% | $4,063 | +18% |
*Merger of Biogen and IDEC
**Acquired by Novartis
Some comments are in order:
• Each of the top 10 companies had sales of at least $1 billion each; except for two companies, all others made money and the entire group made a lot of money: almost $4.4 billion of net income off of about $29 billion in sales.
• The top 10 group of companies grew the revenue line 33% and the profit line 59% (eat your hearts out, Big Pharma!).
• The next group of 15 companies ranges in sales from about $150 million each to almost $500 million each; this group was not as lucky in the profit department with 6 of the 15 companies losing money and the total group losing almost $300 million.
• For an industry that is not supposed to make money, profits actually grew 18% for the top 25 companies. Not bad for an industry that invests an unprecedented amount of money in R&D to develop new products!
Now I have to admit we only listed the top 25 companies out of a worldwide total of close to 4500 biotech companies, so this is not the complete picture. Most of the companies in our industry DON’T make money yet, unfortunately. Many may not even survive, but all are taking large risks to develop cutting-edge innovations in medicine
A final comment: the top 25 biotech companies together have less combined sales than Big Pharma leader Pfizer, but that will most likely change over the next 5-10 years. Pfizer’s growth has slowed considerably and unless it acquires more companies and products, it may even face a decline as key drugs lose their patent life (imagine what a disappearing patent does to a $12 billion/year drug such as Lipitor which probably supplies 20-25% of Pfizer’s annual sales and 30-35%, or more, of its profits).
T-minus 34 days to the Olympics of Biotech: BIO-2006 in Chicago. See you next week!