Femring

GALEN PLEASED the City with another set of soaraway sales figures yesterday, when the Northern Irish drug maker trumpeted its transformation from a sleepy contract manufacturer group to a US- focused pharmaceuticals industry player.

The company, which specialises in female health products such as hormone replacement therapy and contraceptive pills, has bolstered its portfolio of drugs with a string of acquisitions this year and hired new sales staff in the US.

Galen shares jumped more than 7 per cent to 774.5p, their highest in more than two years, when the company said the marketed products it had owned all year grew at 27 per cent.

It sold its pharmaceutical services business - which carried out research on behalf of other drug companies - in 2002. The profit for the year to 30 September was $116.4m (pounds 70m), down from $149.4m the year before which included $105m from the disposal.

However, there were questions over how fast sales growth will be next year, since some of the newly acquired products have been in long-term decline and Femring, its vaginal ring for HRT, has got off to a disappointing start after being launched in the US in June. Jonathan Senior, analyst at Evolution Beeson Gregory, said: "The company said that its new salesforce has been prompted with new information about the declining products and they will be promoting them heavily in the next few months, although they have recently been focused on trying to turn Femring around."

A US court case over Sarafem, a pre-menstrual tension treatment Galen acquired last December, begins tomorrow, with Teva Pharmaceuticals accused of infringing the drug's patents.

Galen has repeatedly come under fire this year for its selective approach to revealing details of patent disputes. But John King, its chairman, again expressed confidence that the US court would vindicate Galen's view that Teva's challenge is without merit and therefore not a material threat to sales.

Mr King revealed that US competition authorities were ready to approve a complicated deal with Barr, another copycat drug maker. This deal lifted the threat that Barr would launch an early challenge to patents on Galen's contraceptive Ovcon, by agreeing that Galen could market Barr's version of the drug.

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