SYNTEX HOSTS UPBEAT SECURITIES ANALYSTS MEETING
SYNTEX HOSTS UPBEAT SECURITIES ANALYSTS MEETING PALO ALTO, Calif., Jan. 10 /PRNewswire/ -- Syntex Corp.
(NYSE: SYN) Chairman and Chief Executive Officer Paul E. Freiman yesterday told securities analysts, at a meeting held at company headquarters in Palo Alto, "We're a company on the move. We're doing well and I think we have a great future."
"Business will be good this year," he said. "We expect the second half of fiscal 1992 to be stronger than the first half, and the latter part of the second half to be stronger than the first, because we are incurring expenses in connection with new product introductions, including our expanded sales force, before we have the full benefit of new product sales." Syntex's sales force, at 1,150, has increased by approximately one-third in the past three years. "It will reach about 1,200, then stop growing," he said. In an interview with a newswire reporter immediately following the meeting, Freiman was asked to comment on projections by some securities analysts that Syntex's earnings per share would be about $2.30 in fiscal 1992. In accordance with longstanding company policy, he declined. "We don't forecast earnings," Freiman said. He went on to indicate that the estimate quoted by the reporter was "in the right ballpark" of published analysts' estimates of which the company is aware; such estimates range from $2.10 to $2.35. The company emphasized that such estimates should not be attributed to Syntex. "Based on strong demand for our innovative, cost-effective newer products and our rich product pipeline, we believe we can achieve our goal of sales and earnings growth in the top 50 percent of the industry during the decade of the 1990s," Freiman told the approximately 85 professional securities analysts, money managers and investors who attended the meeting. Freiman described the decade as "triphasic." He said the first phase, "the one we are in right now," is a very rich phase. "Everything is clicking. New products are coming in a wave, not in a trickle. Old products are doing very well. There's new life throughout the organization." Syntex has had six important new human pharmaceutical products approved by the United States Food and Drug Administration (FDA) since 1988: Cardene, Cytovene, Toradol IM, Synarel, Ticlid and Toradol Oral. "Our newer products are well-regarded by physicians, patients and regulatory agencies worldwide," Freiman said. "During calendar 1991, regulatory agencies in 24 countries outside the U.S. approved various formulations of these products," he said. As previously reported, combined worldwide sales of Cardene, Toradol, Cytovene and Synarel more than doubled in fiscal 1991, to $241.2 million, accounting for 15.6 percent of Syntex's worldwide human pharmaceutical sales. In addition, Syntex has 12 products pending approval at the FDA. They are predominantly line extensions and new indications for currently marketed products. Syntex vice chairman and president of Research Dr. John Fried said at the the meeting that the company expects, in the near term, to receive U.S. marketing approval for more than half a dozen of these. "Some of these line extensions and new indications will make important contributions to our financial performance," Freiman noted. "It's the second phase, the middle of the decade, that will be a challenge to manage," he said. Naprosyn, Syntex's flagship product, loses patent protection in the United States in December 1993. He reviewed the company's strategy to maximize naproxen's contributions to sales and earnings during 1994, 1995 and 1996. "By mid-decade, we expect to have on the market several important Naprosyn line extensions," he said. He also announced that Syntex has contracted with virtually every generic company in the U.S. to purchase naproxen, either in bulk or finished form, from the company. Freiman said that plans to submit a New Drug Application for over-the-counter naproxen are going "very, very well. We believe the over-the-counter product will be introduced well in advance of patent expiration." Freiman said he expects that the third phase, the final years of the decade, also will be a very rich phase for Syntex, because "we have a very substantial product pipeline." He outlined what the company is doing to ensure that some of the resources of the first and third phases are also available during the middle years of the decade. "We have made a calculated decision, at this time of richness, to take some of the profits that would normally flow to the bottom line and reinvest them into the company," he said. Syntex has accelerated its capital investments in new facilities and management systems, and reorganized key areas of its business, "to enable us to achieve our goal of bringing innovative, medically important, cost-effective new products to market in a timely manner," Freiman noted. By the first quarter of fiscal 1993, Syntex expects to have six new or expanded facilities completed. They are predominantly research facilities and pharmaceutical manufacturing plants located in the United States and outside the country. The company plans to invest a total of $315 million in capital projects during fiscal 1992, Freiman said, a 27 percent increase over capital spending in 1991. He said that capital spending in fiscal 1993 is also expected to top $300 million, but to decline gradually in subsequent years. Freiman described the company's recently implemented new Drug Development Optimization Program, which he expects could shave a year or more off the time required to bring new compounds from discovery research to market. The program provides the means to enhance the quality and timeliness of clinical studies; to coordinate worldwide supply, manufacturing, control and distribution in anticipation of product launches; and to respond rapidly to regulatory/scientific inquiries worldwide through a comprehensive, centralized computer database. "We plan to spend approximately $60 to $80 million by the time the system is fully implemented," he said. Freiman also discussed organizational changes. He noted that Dr. Fried will retire as president of Syntex Research, March 31, after 27 years at Syntex. "John Fried has had a distinguished career in the pharmaceutical industry. As co-inventor of naproxen, he has played an important part in advancing the state of nonsteroidal anti-inflammatory therapy." As previously announced, Robert Lewis, M.D., has been appointed president, Syntex Research - Discovery. Dr. Lewis is currently executive vice president and director, basic research and drug evaluation, Syntex Research. Robert Roe, M.D., has been appointed president, Syntex Research - Development. Dr. Roe is currently executive vice president and director, medical research and pharmaceutical development, Syntex Research. "We have also put in place three important organizations," Freiman said, "to meet the challenges of the 1990s. Our product safety and compliance division, established last fall," and consisting of worldwide drug experience data collection, a corporate safety data base, internal regulatory audits and compliance training, "will help us comply with requirements of a regulatory environment that is changing on a daily basis," he said. "In response to the rapidly evolving global economy, we have divided our worldwide human pharmaceuticals business into three sectors -- the United States, Europe and the Pacific." This group, which reports to Jim Wilson, president and chief operating officer, will consist of operating units and a worldwide new product planning team. Highlights of other presentations at the meeting included Dr. Fried's announcement that Syntex and Hoechst A.G. have agreed jointly to develop a novel anti-inflammatory compound, now in early clinical trials, for potential use in treating rheumatoid arthritis. The compound, leflunomide, has demonstrated potent immunosuppresive and immunomodulating activity in animal models of autoimmune disease, Dr. Fried said. Financial terms of the agreement were not disclosed. Jim Wilson, president and chief operating officer, announced that Syntex's marketing partner in the United States, during the first two to three years following the introduction of Toradol Oral, would be Roche Laboratories, Nutley, N.J., the Pharmaceuticals Division of Hoffmann-LaRoche Inc. Toradol Oral was cleared for marketing by the FDA in December, and will be introduced in March. In conclusion, Freiman pointed to a number of measures of Syntex's success in the decade to date. "As previously reported, we achieved a record EPS in fiscal 1991," he said, "representing a 24 percent increase over 1990. Shareholder dividends increased 15 percent in fiscal 1991. "Beyond that, the increase in our share price, showing a 66 percent increase in calendar 1991 over calendar 1990, was the third highest in our peer group. Syntex's market capitalization at the beginning of calendar 1992, at $11 billion, was 68 percent higher than it was at the same time the previous year," he noted. "With the recent U.S. product introductions and 12 products pending at the FDA, I am indeed optimistic about Syntex's performance during this decade," Freiman said. Syntex is a multinational healthcare company that discovers, develops, manufactures and markets prescription medicines that treat serious human diseases. Syntex also develops, manufactures and markets animal pharmaceutical products and medical diagnostic systems. -0- 1/10/92 /CONTACT: Linda Thomas, 415-852-1321; Nancy Peterson, 415-855-5567, or Kathy Gary, 415-855-5924, all of Syntex Corp./ (SYN) CO: Syntex Corp. ST: California IN: MTC SU:
RM -- SJ005 -- 8693 01/10/92 14:43 EST
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|Date:||Jan 10, 1992|
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