Impax Labs experienced a 60% collapse in 2Q profits

Earlier on Tuesday, Impax Laboratories Inc. announced a 60% fall in its second-quarter earnings as compared with last year’s quarter during which period the drug maker had exclusive marketing rights to sell the generic version of Flomax, a treatment for prostrate enlargement.

In the three months that ended on June 30, the Hayward, CA, based company earned 19 cents per share, or $12.6 million that is comparable to the earnings of 48 cents per share, or $31.3 million during the previous year’s quarter. The quarterly profit was found to be 22 cents per share on an adjusted basis as revenues dropped 18% to $125.9 million.

According to a survey by Factset, analysts anticipated average earnings of at least 19 cents per share on revenues of $111.2 million.

Commencing form March 2010, Impax was exclusively permitted to market the generic version of Flomax for eight whole weeks. Competition for the generic made an impressive market entry in late April 2010 resulting in the wipe-out of the company’s market share.

Sales of the generic version of Flomax plummeted to $3.7 million from $27.4 million. Owing to the disruptions in product supplies, sales for a generic version of Adderall XR (an attention deficit hyperactivity drug) dropped 8 % to $58.2 million.

In the quarter, the company also saw operating expenses jumping 19% to $41.7.
In afternoon trading, shares of Impax fell 4.7 percent, or $1, to $20.10.