NEW YORK, April 23 – Strong sales in Asia helped to buoy Amersham Pharmacia Biotech's first-quarter revenues, despite a slowdown in sales in North America, the company said Monday.
“We have seen some waiting and caution on the part of the biotechnology companies in areas where customers spend on capital equipment, due to the uncertainty in the market,” said Tracy Cheung, vice president of investor relations at AP Biotech.
Last month, AP Biotech's main rival, Applied Biosystems, cut its forecast for near-term sales growth to about 10 to 15 percent, compared with a longer-term forecast for a compounded 20 percent growth rate, citing a drop in demand as a result of the economic downturn. At the time, analysts attributed the slide to a drop in demand for Applied Biosystems' 3700 sequencers, but noted that the company was demonstrating increased sales for its lower throughput models.
Cheung declined to say whether sales of AP Biotech’s equivalent of the 3700, the MegaBace sequencer, had declined, but she did note that strong sales in Asia and sales of other products such as protein separation technology for pharmaceutical companies, helped the company avoid being affected by the weakness in the North American market for capital equipment.
“We have a broad portfolio of products,” Cheung said.
As a result, AP Biotech did not see the economic slowdown translate into slower growth overall this quarter. AP Biotech’s sales for the first quarter increased 21 percent to $222 million.
Parent company Nycomed Amerham of the UK said its businesses grew 16 percent over the year-ago quarter, to 375 million pounds, or $540 million, up 16 percent over sales in the year ago period.
Nycomed said its continued success was due to AP Biotech’s strong sales in Japan and other markets, as well as to proteomics-fueled increases in the drug discovery business and strength in the imaging and separation sectors.
“Our first quarter demonstrates not only strong growth in diagnostic imaging markets worldwide, but also the benefits of our own geographical diversity,” William Castell, CEO of Nycomed Amersham, said in a statement. “There were particularly strong performances from our life sciences business in Japan and other international markets, and from our imaging business in North America."
Separately, Reuters reported that Nycomed's plans to float shares of AP Biotech, which it jointly owns with Pharmacia, were still on hold.
"Our businesses are generating profits and cashflows, so it's not imperative to go to the market to raise cash," Reuters cited Castell as saying. "We will go to the market when the conditions are right. We will choose our time and will do it prudently."
Nycomed, which filed for the IPO in October, has delayed the float due to the downturn in the market conditions.