United Therapeutics' Profit Surges

United Therapeutics Corp., whose stock soared last year on a series of strong earnings reports, hit a snag in its fourth-quarter 2005 results, missing Wall Street's increasingly high expectations for the company.

The Silver Spring drug firm, whose lead product treats pulmonary arterial hypertension, a rare condition of dangerously high blood pressure in arteries between the heart and lungs, recorded fourth-quarter sales of $29.6 million, about 25 percent below Wall Street's forecast. The total was also about $4 million below third-quarter sales.

United Therapeutics' quarterly profit came in at $29.4 million ($1.14 a share), though that included a one-time tax benefit of $17.5 million. Without the tax benefit, United Therapeutics made $11.9 million; analysts had been expecting that figure to be about $17 million. The company earned $6.9 million (28 cents) in the comparable period the year before.

"All the numbers reported are much lower than expected," Navdeep S. Jaikaria, an analyst with Rodman & Renshaw LLC, wrote in a research report.

Not hitting Wall Street's expectations sent United Therapeutics shares down 8 percent, or $5.45, to $61.57.

During a conference call with analysts and investors, company executives blamed the results on seasonal choppiness in sales for its lead product, Remodulin.

But some analysts, including Jaikaria, had a different take, blaming the poor showing on competition from a new treatment called Ventavis, which is inhaled, not continuously pumped into the body like Remodulin. Ventavis, made by CoTherix Inc., hit the market in March 2005.

"I think that certainly Ventavis is probably having some degree of impact on Remodulin sales," said Jennifer Chao, an analyst with Deutsche Bank. The poor sales results "are going to put the company and Remodulin in a defensive position coming into 2006," Chao said.

United Therapeutics is developing its own inhaled version of Remodulin, Chao said, which could win approval at the end of 2007. She expects inhaled Remodulin to eventually leapfrog Ventavis in sales because Remodulin will probably need to be inhaled fewer times per day.