The main Irish holding company of US drug group Forest Laboratories Inc has reported annual pretax profits of $668.77 million (€460.51 million) in the year to March, twice its profit in the previous fiscal period.
The profit made by Forest Laboratories Holdings - which has its registered office in Clonshaugh, Dublin - was almost as large as the $708.84 million pretax profit declared for the same period by its New York parent.
Robert Westreich, an executive director in the parent group, said it was not the case that the Irish company made 90 per cent of the group's profit last year. The Irish firm made its profit by selling drug products to the parent, he said, but the parent does not book its share of the profit from such products until it sells them to third parties.
New filings in the Companies Office show that the holding company's pretax profit last year rose from $332.87 million in the year to March 2006.
At the same time, the company's revenues rose to $1.63 billion from $1.37 billion.
Most of the revenues derived from inter-company sales. According to the 2007 annual report for Forest Laboratories Inc, the group's net sales to third parties in the Republic amounted to only $13.68 million.
Forest ranks among a large number of multinationals that use operations in the Republic to minimise their tax exposure in the US. Its development and manufacturing operations here operate under tax incentives that currently expire in 2010, according to its annual report.
Mr Westreich said Forest employs about 200 people at manufacturing plants in Clonshaugh and Baldoyle. The company makes Sudocrem for the world market and drugs such as Lexapro, for depression, and Namenda, for Alzheimers. The new filings for the holding company say that Lexapro and Namenda accounted for the "majority" of its sales.
In 2004 the Irish holding company paid a $1.26 billion dividend to its parent to avail of a one-off tax concession on repatriated profits which was introduced by president George Bush.
The company did not pay out a dividend last year. Its profit led to a big increase in the value of the profit-and-loss account on its consolidated balance sheet, which rose $1.65 billion from $985 million.
