By Mary Welch
Genzyme General reported its 1998 revenues increased 13 percent over 1997, to $673 million, and were driven by sales of Gaucher's disease products.
Fourth-quarter 1998 revenues were $182 million, an increase of 17 percent over revenues of $156 million for the same period in 1997. The Cambridge, Mass.-based company will release complete figures on March 4.
"It was a solid year and it was expected," said Elise Wang, a first vice president at PaineWebber Inc., of New York.
Sales of the company's Gaucher's treatments, Ceredase and Cerezyme, totaled $113 million in the fourth quarter, compared to $90 million a year earlier. For the year, sales of the drugs were $411 million, compared to $333 million in 1997.
Soham Pandya, an analyst with Lehman Brothers in New York, said the top-line numbers were "better than expected. On the Ceredase and Cerezyme product lines, we were expecting it in the $107 million range, and of course they were higher."
Caroline Copithorne, senior biotechnology analyst with Prudential Securities Inc. in New York, said Genzyme's numbers were "way above what I was looking for. My numbers were about $175 million and they reported $182 million. Ceredase and Cerezyme were above my estimates. They must have other revenue increases that they haven't released yet."
Product and service sales for the quarter increased 20 percent to a record $182 million, from $151 million in the fourth quarter of 1997.
"Ceredase is doing better than expected but not by a whole lot," Wang said. "We estimated $110 million and it came in at $113 million. It's showing very strong growth - a 25 percent increase over fourth-quarter 1997. It's well on its way to becoming a $410 million annualized product."
Cerezyme and Ceredase are enzymes for Gaucher's disease. Cerezyme (recombinant glucocerebrosidase) eventually will replace Ceredase, the natural version of the enzyme, which is derived from human placenta.
The company also reported research and development revenues in the fourth quarter of $900,000, down from $5 million in 1997. "R&D revenues will float. I'm not at all bothered by it," Wang said.
Separately, Genzyme Tissue Repair, of Cambridge, Mass., reported record product revenues for 1998 totaling $17 million, a 56 percent increase from $11 million in 1997. Fourth-quarter 1998 revenues were $4.5 million, a 44 percent increase from $3.1 million over the same period last year. Genzyme Tissue Repair is a division of Genzyme Corp.
The increase in product revenues was led by an 81 percent growth in U.S. sales of Carticel autologous cultured chondrocytes for the treatment of knee cartilage damage. U.S. Carticel sales were $8.8 million for 1998, up from $4.8 million in 1997. Fourth-quarter 1998 sales of Carticel in the U.S. were $2.6 million, up from $1.6 million in 1997, a jump of 64 percent.
Worldwide 1998 Carticel revenues were $11 million, up 66 percent from $6.6 million for 1997.
Revenues from Epicel skin grafts, a skin replacement product for severe burns, grew to $6 million in 1998, an increase of 39 percent from $4.3 million in 1997.
Genzyme Tissue will issue its full financial report March 3. Effective Feb. 15, the company's stock symbol will change to GZTR.
Genzyme General's stock (NASDAQ:GENZ) closed Wednesday at $53.125, up $1.625. Genzyme Tissue Repair's stock (NASDAQ:GENZL) closed Wednesday at $2.75, up $0.125. n