Please ensure Javascript is enabled for purposes of website accessibility

Eli Lilly Buys Animal Health Business, Lowers Forecast

By Associated Press – Feb 24, 2014 at 11:20AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Lilly has been hit hard by patent losses in recent years and has said it expects both earnings and revenue to dip this year as it adjusts.

INDIANAPOLIS (AP) -- Eli Lilly is buying a privately held, poultry vaccine maker to strengthen its Elanco animal health subsidiary.

No terms were released, but Lilly said Monday that its 2014 earnings forecast will be trimmed due to acquisition costs.

The Indianapolis drugmaker recently lost patent protection for its top-selling product, the antidepressant Cymbalta. Lilly has been hit hard by patent losses in recent years and has said it expects both earnings and revenue to dip this year as it adjusts.

The company, which also is known for a portfolio of diabetes treatments, has said it will depend on its animal health business to help make up for the loss of revenue.

Germany's Lohmann SE also sells a range of feed additives, but Lilly said that the acquisition will significantly increase Elanco's ability to make vaccines. Competing in that market is a "cornerstone" of the subsidiary's long-term strategy, the company said.

The deal is expected to close in the second-quarter.

The company now expects adjusted earnings for this year to range between $2.72 and $2.80 per share due to accounting adjustments and costs tied to the deal. That's down from its previous forecast for between $2.77 and $2.85 per share.

Analysts had expected earnings of $2.83 per share, according to FactSet.

link

The Motley Fool has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
360%
 
S&P 500 Returns
118%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 11/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.