Eli Lilly reported first-quarter earnings fell 39 percent due to charges related to its acquisition of Icos and plant closings. But revenue jumped 14 percent on higher sales of key drugs - the Cymbalta depression pill and Cialis for erectile dysfunction.

Citing the sales surge, Lilly boosted its forecast for revenue and and earnings for 2007, citing “stronger underlying business fundamentals.” First quarter earnings fell to $508.7 million, or 47 cents per share, from $835 million, or 77 cents. Excluding special items, profit was 84 cents, compared with 77 cents expected by analysts. Sales rose 14 percent to $4.23 billion. The results also reflected a 5 percent price increase.

One surprise: Lilly that the FDA rejected it appeal of an approvable letter issued last year for Arxxant, a med for diabetic eye disease, and the agency reiterated its request for a three-year study before approval will be considered. For now, Lilly has withdrawn its application for European approval.

Meanwhile, Lilly expects sales this year of its controversial Zyprexa schizophrenia pill to be flat, amid ongoing concern over side effects such as weight gain and diabetes associated with the drug. Sales rose 10 percent to $1.11 billion in the first quarter, with a 14 percent increase overseas and a 6 percent gain the US.

Further reading…
Lilly press release;
Reuters.[tags]Eli Lilly, Zyprexa[/tags]