WuXi ratchets up expectations after banner quarter

WuXi PharmaTech CEO Ge Li

WuXi PharmaTech ($WX), China's largest CRO, is counting on the burgeoning drug development market in its home country to deliver a big 2013, stretching its annual revenue guidance after another quarterly boost.

The CRO pulled in $142.3 million in revenue last quarter, a 9.2% increase over the same period last year, and net income leapt 44.6% to $29.6 million. WuXi's lab services business grew 13.2% to $105.9 million on the quarter, offsetting a 1.1% decline in manufacturing sales, which came in at $36.4 million.

Now WuXi is scaling up its full-year revenue expectation by up to $13 million, planning for roughly 16% annual growth and as much as $578 million in 2013.

Driving that optimism is WuXi's recent dive into biologics, CEO Ge Li said. The CRO opened China's first U.S. GMP-friendly biologics facility back in November, and Li said the new plant is already contributing to revenue. Furthermore, the CRO is pushing forward on a joint venture with PRA, last month recruiting former Theorem Clinical Research CEO James Pusey to helm the China-focused collaboration.

"WuXi is also effectively controlling its costs through continuous operational improvements, increased productivity and implementation of a company-wide Lean Sigma program," Li said in a statement. "We are investing in capabilities and capacity to sustain long-term revenue and earnings growth."

The company plans to spend about $60 million in capital expenditures on the year, Li said, following its long-term efforts to expand its presence in China and around the world. WuXi's efforts have helped it recruit big-name partners like AstraZeneca ($AZN), Vertex Pharmaceuticals ($VRTX), Ambrx and MedImmune, and the CRO believes its expertise and footprint make it an ideal partner for Western drugmakers looking for inroads into China.

- read WuXi's results

Suggested Articles

WuXi AppTec has cut the ribbon on its expanded Laboratory Testing Division in New Jersey as it looks to boost its integrated testing service portfolio.

St. Jude, Microsoft and DNAnexus have created a data-sharing and analysis platform to help accelerate pediatric cancer research.

The money will be used to expand its footprint in both China and the U.S., including a new R&D operation in Boston.