UCB expects to beat 2010 estimates; plans Cimzia plant expansion

By Gareth Macdonald

- Last updated on GMT

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Belgium’s UCB expects to beat its guidance for 2010 due to higher than expected drug sales.

The biopharmaceutical firm predicted that revenue from its epilepsy treatment Keppra in Europe, where it is yet to face generic competition, will help it beat the €3b ($4bn) and EBITDA of €700m it previously forecast.

UCB, which did not issue revised guidance for 2010, said it will also recognise impairment charges amounting to €240-250m, surpassing 2009's impairment charges of €126m.

Company CFO Detlef Thielgen said: “We are very satisfied with our operating performance in 2010," ​adding that "our key financial performance indicators will surpass our financial outlook givenearlier in 2010.

While non-cash, one-time write offs and impairment charges impact ourbottom line we are confident to show a positive net result for 2010​."

Conservative response

Some observers did not share Thielgen’s opinion, suggesting that the original guidance was on the tentative side.

KBC analyst Jan de Kerpel told Reuters that: “[UCB] had shown good results in the first half but kept a very conservative guidance for various reasons. It seemed conservative to me back then and this has now become clear​.”

Kerpel added that: “They already felt strong competition for Keppra in the US, where its patent expired last year," going on to say that “Companies try to make the most of the period just before the patent expires. You see that often because they know it will be more difficult to remain the same level of sales afterwards​.”

Cimzia plant expansion

UCB also cited several of newer biopharmaceutical products as important performers in 2010.

Key among these was the Crohn’s disease treatment Cimzia, which is timely given that the firm announced a $250m plan to expand manufacturing capacity for the product late last month.

Speaking a few weeks ago Michele Antonelli, Executive Vice President for Technical Operations and QA said: “We want to be able to meet our projected future demand for 2015…by adding internal capacity to our existing capacities with our productions partners​.”

He went on to say that the site in Bulle, Switzerland “is the right place and most cost effective location to build our own biotech manufacturing unit which enables us to further improve our productivity at attractive terms.

The new unit together with the bio-pilot-plant under construction in Braine l'Alleud, Belgium will also strengthen our ability to deliver our future biological products​."

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