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Teva trims 2016 outlook on drug launch delays

Teva Pharmaceutical Industries' Jerusalem oral solid dosage plant (OSD) is seen December 21, 2011. REUTERS/Ronen Zvulun

By Tova Cohen TEL AVIV (Reuters) - Teva Pharmaceutical Industries on Tuesday lowered its full-year earnings forecast, citing launch delays for some drugs that have been pushed back by a year or so. Israel-based Teva reported stronger than expected third-quarter profit as sales were boosted by its $40.5 billion purchase of Allergan's generic drug business in August. The world's biggest generic drugmaker forecast earnings per share (EPS) excluding one time items of $5.10-$5.20 in 2016 and revenue of $21.6-$21.9 billion. In August, it had estimated adjusted EPS of $5.20-$5.40 and revenue of $22-$22.5 billion. "What has brought numbers lower are revenues from new launches," Siggi Olafsson, CEO of Teva's global generic medicines, told an analysts' conference call, noting the company had expected 3-4 more launches. "They will come later in 2017 or 2018, they are not lost at all. This moves the growth curve." Teva shares were down 5 percent at $39 in early trade in New York. Teva Chief Executive Erez Vigodman said the company had spent a significant amount in the past year to acquire assets. "Now it is time for Teva to step away for the foreseeable future from executing material ... deals and focus all of its energy on organic growth and extracting all of the deal-related synergies," Vigodman said. He said the company was re-evaluating priorities in 2017. "If there are projects that won't generate value I will terminate those projects," he said. Wells Fargo analyst David Maris said: "We like this as we think companies benefit from pausing for a period after major deals to help consolidate the businesses." Maris rates Teva "outperform". Teva earned $1.31 per share, excluding one-time items, in the third quarter, down from $1.35 a year earlier due to share offerings in December to finance the Allergan deal and shares issued to Allergan in August. Adjusted net income rose to $1.4 billion from $1.2 billion. Revenue rose 15 percent to $5.6 billion, primarily due to the inclusion of $887 million from Allergan. Excluding foreign exchange fluctuations, revenue increased 19 percent. Teva was forecast to earn $1.28 excluding one-off items on revenue of $5.7 billion, according to Thomson Reuters I/B/E/S. Mizuho analyst Irina Koffler attributed the revenue miss to its speciality drugs business, which had revenue of $2.05 billion versus $2.06 billion forecast by analysts. Global sales of its best-selling multiple sclerosis drugCopaxone slipped 2 percent to $1.1 billion. The drug is now facing competition after Sandoz, part of Swiss drugmaker Novartis AG , and Momenta Pharmaceuticals last year launched a once daily 20 mg version called Glatopa. Teva said it would disclose its 2017 operating plan and forecast with fourth-quarter results in February. Teva also made a $520 million provision to settle previously disclosed investigations of the Foreign Corrupt Practices Act by the U.S. Justice Department and Securities and Exchange Commission. The provision relates to conduct in Russia, Mexico and the Ukraine during 2007-2013. (Additional reporting by Steven Scheer. Editing by Jane Merriman)