NEW YORK (AP) -- Valeant Pharmaceuticals International Inc. on Thursday said it lost money in the first full quarter after the deal its merger with Biovail Corp. due to hefty charges.
The company also raised its 2011 profit forecast, sending shares higher in midday trading.
Valeant said it took a loss of $13.1 million, or 10 cents per share, in the December quarter, primarily because of costs related to the Biovail deal. Charges connected to the acquisition included $53.3 million in inventory adjustments and $17 million in increased stock based compensation. It also reported $122.7 million in amortization and other non-cash charges -- almost triple its total from a year ago -- while restructuring and acquisition-related items increased to $44.1 million from $14.9 million.
Excluding one-time items, Valeant said it earned 51 cents per share.
Revenue rose to $514.6 million.
Analysts expected a profit of 41 cents per share and $513.9 million in revenue, according to FactSet.
The combination of Valeant and Biovail closed in September. Biovail acquired Valeant in the deal, but the company took the Valeant name. It retained Biovail's corporate structure, including its Mississauga, Ontario, headquarters.
In the fourth quarter of 2009, Biovail earned $73 million, or 46 cents per share, on revenue of $241.1 million.
Valeant sells treatments for chronic illnesses and generic drugs, while Biovail's products include the antidepressant Wellbutrin XL and pain drug Ultram ER. The company said its product sales rose to $488.7 million from $231.6 million for Biovail alone. Alliance and royalty revenue jumped to $20 million from $5.2 million, and service and other revenue grew to $5.9 million from $4.3 million.
Earlier this month, Valeant agreed to buy generic and over-the-counter drug maker PharmaSwiss SA in a deal worth 350 euros ($480 million) upfront. It also agreed to acquire the rights to market GlaxoSmithKline PLC's Zovirax antiviral cream in the U.S. and Canada for non-eye care uses. That deal is worth a total of $300 million. The company acquired the U.S. rights to Zovirax on Tuesday. The Canadian portion of the deal is expected to close by the end of March.
For the full year, the company reported a loss of $208.2 million, or $1.06 per share. In 2009, Biovail earned $176.5 million, or $1.11 per share. Revenue rose 44 percent to $1.18 billion from $820.4 million.
Valeant raised its profit guidance for 2011, and now expects income of $2.45 to $2.70 per share. Previously it had forecast a range of $2.25 to $2.50 per share. Analysts expect $2.36 per share, on average.
Valeant shares rose $2.20, or 5.7 percent, to $40.91.