Eli Lilly (NYSE: LLY) shares slid on Wednesday over concerns about its animal health unit and pricing in the diabetes care market.
The animal health segment's fourth-quarter revenue decreased 6% from the year earlier. Lilly CEO Dave Ricks told analysts the company expects slightly negative growth in the first half of 2018 but eight product launches will drive top-line growth later in the year.
Revenues registered at $6.2 billion vs. expectations of $5.9 billion.
In the fourth quarter, the pharmaceutical company reported a net loss of $1.7 billion, or $1.58 per share, compared with net income of $771 million, or 73 cents per share, in the year-ago quarter.
However, after stripping out special items, such as $1.9 billion associated with the new tax law, the company earned $1.2 billion, or $1.14 per share, above Street estimates of $1.07 per share
Lilly claims to be considering strategic options for the animal health business, Elanco. Ricks said the company is on track to announce a decision on its second-quarter earnings call in July.
Pricing around Lilly's diabetes portfolio also caused some concern. Enrique Conterno, head of the diabetes business, said the company continues to see pressure on pricing across all its diabetes products.
Despite the difficulties in animal health and diabetes, Lilly's slew of new pharmaceutical products helped the company beat fourth-quarter earnings estimates, while the new tax law boosted its 2018 earnings guidance.
Lilly shares dropped $3.97, or 4.6%, to $82.12.
