Allergan reports big impairments but beats expectations

Pharmaceuticals name Allergan reported sharp losses today after it reported billions of dollars in impairment charges.

The company registered impairment charges of $4.1bn, mainly related to its Restasis drug.

There was also a $1.3bn write-down on the value of its stake in struggling drugs company Teva.

Allergan reported a third-quarter GAAP operating loss from continuing operations of $4.02bn.

Sales strength

Nevertheless, Allergan beat third-quarter expectations driven by strength in its medical aesthetics and eye care businesses. As a result, the shares were up modestly in premarket US trading.

Third-quarter net revenues rose 11% to $4.03bn.

The botox maker also slightly raised its full-year profit guidance to a range of $16.15 to $16.45 per share versus the prior $16.05 to $16.45.

Impairments

Allergan was dealt a blow last month when a Texas court ruled against its patents on Restasis.

Meanwhile, the latest impairment on Teva follows a $2bn write-down incurred earlier in the year.

Israel-based Teva has been among the worst performing stocks this year as its generics drugs business has been hit by intense competition in the US generic drugs market.