Genzyme profits leap 58% in 2d quarter

Genzyme Corp. reported a 58 percent jump in second-quarter profits yesterday, driving its stock up more than 6 percent to an all-time high.

Strong sales of the drug Fabrazyme, used to treat a rare genetic disorder, and Synvisc, a treatment for arthritic knees, helped push net income up to $123.6 million, or 46 cents per share, from $78.2 million, or 33 cents per share, during the same period last year.

The Cambridge drug developer, one of the country's largest biotechnology companies, also raised its profit forecast for the year. Though much of Genzyme's sales still come from Cerezyme, a treatment for a rare genetic disorder called Gaucher disease, the company yesterday reported significant sales increases in several other areas, from the dialysis drug Renagel to a genetic-testing service.

In a conference call with investors yesterday, Genzyme chief executive Henri Termeer said the growth vindicated his strategy of widening the company's scope by acquiring new drugs and cutting costs by producing them in-house.

Many analysts agreed. ''It used to be a company of mainly Cerezyme, but now there's five or six products that are contributors, and for a biotech company that's fairly diversified," said Phil Nadeau, a biotech analyst at SG Cowan & Co.

Cerezyme, which was introduced in 1991 and is manufactured at the company's plant in Allston, is an intravenous treatment that replaces the enzyme lacking in the cells of patients with Gaucher disease. About 4,400 people worldwide use the drug, for which the company charges about $200,000 a year per patient. The drug generated $236 million of Genzyme's $668 million second quarter revenue, about one-third, but the percentage has been decreasing in recent years.

Fabrazyme, introduced in Europe in 2001 and in the United States in 2003, is used to treat a related genetic disorder called Fabry disease and also costs about $200,000 a year. Quarterly revenues from Fabrazyme grew 50 percent from the same period last year, to $74.4 million. About 1,500 patients worldwide use the drug.

In the past several years, Genzyme has transformed itself into one of the powerhouses of the biotechnology industry, using its steady income from Cerezyme to purchase a broad portfolio of drugs and products developed by smaller companies.

Synvisc, an artificial knee fluid, was developed by a company called Biomatrix that Genzyme acquired in 2000. Renagel, which helps reduce phosphate buildup in kidney-dialysis patients, was developed by GelTex, a Waltham company later acquired by Genzyme.

Termeer said yesterday that Genzyme is starting to benefit from ''the effect of the way that the company has been pulled together over the last number of years. We are seeing the impact of product differentiation very clearly. We have a very broad range of products."

Its newest acquisitions, a $1 billion deal to buy Ilex Oncology last December and a $600 million deal to acquire Bone Care International in May, are designed to help the company boost its cancer and kidney disease businesses.

This year, Genzyme emerged as the region's top biotech firm, ranked by market capitalization, after Biogen Idec Inc., also of Cambridge, voluntarily withdrew its multiple sclerosis drug Tysabri because of unexpected illnesses, causing its stock to drop about 50 percent.

Stephen Heuser can be reached at sheuser@globe.com.