Top drug companies' earnings beat forecasts

By Ben Hirschler

LONDON (Reuters) - The world's two biggest drugmakers, Pfizer (PFE.N) and GlaxoSmithKline (GSK.L), both beat expectations for quarterly earnings on Wednesday, as did Wyeth WYE.N, indicating the sector's resilience.

Although all three companies face major threats from generic competition, the latest results show demand for medicines is holding up relatively well at a time of economic downturn.

"The pharma figures are quite encouraging but we shouldn't get carried away," said Justin Urquhart Stewart of Seven Investment Management in London.

"They are better than expected in a weakening economy but the problem with pharma is always the risk you are running the pipeline of new drugs."

Pfizer's quarterly earnings more than doubled on higher sales of its prescription medicines and lower costs, with the U.S. group company earning $2.78 billion (1.4 billion pounds), or 41 cents per share, in the second quarter, against 18 cents a year earlier.

Excluding special items, Pfizer earned 55 cents per share. Analysts on average expected 54 cents per share, according to Reuters Estimates.

British-based Glaxo posted a pre-tax profit of 2.02 billion pounds, equivalent to a 13 percent jump in earnings per share to 27.2 pence, beating the consensus forecast of 25p.

By contrast, Wyeth's second-quarter profit fell 7 percent to $1.12 billion, or 83 cents per share, from 87 cents a year earlier, due to generic competition faced by its Protonix ulcer drug.