Allergan Inc., maker of the wrinkle-smoother Botox, reported Friday that its first-quarter profit fell 58% as the recession slowed sales of eye and beauty products.
Net income dropped to $45 million, or 15 cents a share, from $108 million, or 35 cents, a year earlier, the Irvine company said. Profit excluding some items was 55 cents a share, beating by 2 cents the average analyst estimate.
Revenue fell 6.4% to $1.01 billion, matching analysts' estimates. Sales of Botox dropped 18.2% to $297.3 million. The toxin accounted for $1.3 billion in 2008 sales, almost a third of Allergan's revenue.
Sales of Allergan's eye-care products, including Lumigan and Alphagan for glaucoma and Restasis to treat dry eyes, fell 18.6% to $473.6 million.
"Clearly, the economy will need to change for Allergan to resume significant growth," said Sean Lavin, an analyst for Lazard Capital Markets in New York, in a note to investors.
Allergan is firing about 460 sales and marketing workers in its urology business, about 5% of the workforce, to brace for declining sales of Botox as consumers cut cosmetic spending, the company said in February.
Allergan was ordered by U.S. regulators Thursday to strengthen the drug's label precautions, hours after makers of Botox's first major competition said their treatment was approved for sale.
Botulinum toxins, including Botox and its new competitor Dysport, from Ipsen of France and Medicis Pharmaceutical Corp. of Scottsdale, Ariz., relax forehead lines and treat neurological disorders. The treatments may cause muscle weakness or breathing difficulties if the poison spreads beyond the site of injection, the Food and Drug Administration said. The agency ordered manufacturers to add a boxed warning to their prescribing information and begin programs to minimize risks.
Allergan shares fell $2.87, or 6.2%, to $43.79. The shares have fallen 23% in the last 12 months.