Ebb & Flow

In the best of all possible worlds, revenues from the launch of MedImmune's FluMist intranasal influenza vaccine would have more than made up for planned increases in R&D spending, thus keeping EPS intact. When that didn't happen, MEDI decided to keep spending up anyway.

As a result of that decision, the company's first quarter net income grew only 1% quarter over quarter from $110 to $111 million, despite revenue growth of 13% from $431 million to $489 million. Much of the difference was in the R&D line, as first quarter R&D spending increased 57% to $49.8 million from $31.7 million in the 2003 quarter. ...