Ipsen Delivers Strong 2009 Sales Performance Driven by Specialty Care Business, Up 16.1%

French pharmaceutical company Ipsen has closed the books on a strong performance, achieving its guidance of 7-9% year-on-year (y/y). In 2009, the group achieved a 6.8% y/y jump in underlying group sales to 1.032 billion euro with total pharmaceutical sales up 7.6% y/y at constant exchange rate to 1 billion euro. The growth was mainly fuelled by the group's specialty care business which achieved growth sales of 13.9% y/y—at constant exchange rate—to 553.1 million euro. Meanwhile, its primary care business dropped 1.4% y/y at constant currency to 380 million euro in 2009.

In Ipsen's top five Western European countries, the business contracted by 0.9% y/y essentially due to increasing competition in key products, including the entry of generic versions of Forlax and a slowdown in metastatic prostate cancer drug Decapeptyl (triptorelin embonate) revenues following the launch of two six-month formulations marketed by competitors. Ipsen's own six-month formulation of Decapeptyl should hit the market early in 2010 (see France: 13 October 2009: Ipsen Clinches European Nod to Market Decapeptyl Six-Month Formulation). Its marketing is key for Ipsen's short-term success as the drug's monthly and quarterly formulations' patent expires in 2010. In other European markets, Ipsen did not report better performance with a 0.8% y/y fall to 236.2 million euro in full-year sales. The slowdown in Europe was offset by good performance in the rest of the world and particularly in North America regions where sales jumped to 45.7 million euro, up from 11.2 million euro in 2008. In North America, Ipsen's performance was boosted by the penetration of Increlex, Somatuline (lanreotide) and to the launch of the freshly approved Dysport in the U.S. market in October, coming after months of delays as regards to the U.S. approval (see France: 29 October 2009: Ipsen Posts 7.8% Y/Y Rise in Q3 Sales Growth, Launches Dysport in U.S.). Meanwhile, in the rest of the world, sales reached 198.2 million euro, up 20.8% y/y. Financial results figures for the fourth quarter and for the year 2009 will be published in the group's annual report on 1 March.

For the fourth quarter of 2009, sales of specialty care products jumped 16.1% y/y to 157.8 million euro and 13.9 % y/y at constant exchange rate to 622.5 million euro for the full year 2009. The weight of specialty care products in Ipsen total sales grew from 57.0% in 2008 to 60.3%, now representing the majority of its revenue. The franchise was mainly driven by Dysport and Somatuline, both up 18% y/y at constant exchange rate, helping to offset challenges brought by a tough economic situation and generic competition in key markets. The launch of Dysport/Azzalure in the U.S. and European markets helped Ipsen boost its neurology franchise sales by 40.2% y/y in the fourth quarter of 2009. While, top-selling prostate cancer treatment Decapeptyl saw a slight 1.4% gain in 2009 to 250.5 million euro, growth hormone treatments Somatuline and NutropinAq (somatropin [rDNA origin] injection) were up 18.2% and 26.5% respectively in constant currency. In primary care, Ipsen reported decreasing sales with revenues down 1.4% y/y in constant currency to 380.1 million euro for 2009, with a sharp decline in Forlax sales, down 25.4% y/y in the fourth quarter and 15.2% for the full year.

During the fourth quarter, Ipsen announced the approval of the six-month sustained-release of Decapeptyl (triptorelin embonate) in France for the treatment of locally advanced or metastatic prostate cancer following the completion of the European decentralised registration procedure in nine countries: Germany (reference member state), France, Austria, Finland, Norway, Belgium, Denmark, Spain and the Netherlands (see Switzerland – France: 13 October 2009: Ipsen Clinches European Nod to Market Decapeptyl Six-Month Formulation). Meanwhile, Ipsen strike a major partnership agreement with U.S.-based Inspiration Biopharmaceuticals, worth US$85 million. The deal will see Ipsen gradually banking on haemophilia as a key component of its specialty care business, as Ipsen increasingly focuses on the latter to make it its strongest portfolio segment (see: United States: 22 January 2010: Ipsen Expands in U.S. with Inspiration Deal, Seeks to Position Itself as Reference Player in Haemophilia).

Outlook and Implications

Overall, despite a tough macroeconomic situation, Ipsen has achieved its main objectives for 2009 with the U.S. approval and launch of Dysport, the partnership with Italian company Menarini for Adenuric (febuxostat) in Europe, the approval of Decapeptyl six-month in Europe and the launch of a Phase III trial of Somatuline in neuro-endocrine tumours in the United States. As Ipsen is facing difficulties in Western Europe with losses from older products, the company confirms its growing interest in the North American market and in its strong specialty care business. The announcement of a major deal with U.S.-based Inspiration in January is the last mark of an increasing focus on these two strategic businesses, set to become key driver of Ipsen's revenues in coming years. This should help to offset losses induced by tough competition in its primary care market, in particular, where products without patent protection—including Smecta and Forlax—are at risk.

In 2009, the group has slightly benefited from currency fluctuations except in the United States. In coming years, Ipsen's sales should not be significantly impacted by currency instability as most of its sales—53.7% in 2009—are generated in Europe. However, this might change if Ipsen continues to strengthen its presence in North America and emerging countries.