Rob Black's Healthcare Market Roundup For March 25 (AHG, DNA, FRX, LH, PG)

Forest Laboratories Inc. (FRX) said income increased by 74% to $91.9 million from $52.8 million a share in the year-ago period. Revenue increased 16% to $756.3 million from $653 million.

Forest Labs will incur significant milestone and R&D expense in the coming year. The company expects 10-11% sequential increase in Lexapro sales. The company also expects Namenda sales to be up 22% sequentially.

Procter & Gamble (PG) was upgraded to Strong Buy at Buckingham.

Apria Healthcare Group (AHG) said profit fell to $16.1 million from $25.2 million a year ago. Revenue declined to $368.1 million from $371.9 million in last year's first quarter. The respiratory therapy provider said results were hurt by a drop in Medicare reimbursements.

Laboratory Corporation of America (LH) reported earnings of $101.9 million up from $96.6 million in the year-earlier period. Revenue rose to $878.5 million from last year's $799.1 million. Looking ahead, the drug testing technologies company still expects revenue growth of 6.5% to 7.5%.

RBC expects positive Phase III data for Genentech Inc’s (DNA) Avastin in kidney cancer and pancreatic cancer in 2006. They say Phase II results for an Avastin/Tarceva combination in lung cancer will be presented at ASCO in June, which could signal potential positive data from an ongoing Phase III trial in this setting.