* Q3 non-GAAP EPS up 46 percent to $1.30 vs $1.27 forecast
* Analysts concerned over European generic sales
* Sees 2010 rev $16.4 bln, EPS ex-items $4.50-$4.60
* To pay dividend of $0.193 a share
* Shares down 0.5 percent on Nasdaq
(Adds 2010 outlook, CEO quotes, Nasdaq share price)
By Tova Cohen
TEL AVIV, Nov 2 (Reuters) - Teva Pharmaceutical Industries, the world's biggest maker of generic drugs, posted higher quarterly net profit that beat expectations, boosted by strong U.S. sales and its acquisition of Germany's Ratiopharm.
Third quarter sales in North America rose 22 percent to $2.72 billion while generic sales in the United States jumped 34 percent to $1.63 billion, Israel-based Teva said on Tuesday.
Teva attributed the increase to the exclusive launch of a generic version of Wyeth's $2.75 billion-a-year antidepressant Effexor XR in the quarter as well as strong sales of generic drugs launched in previous quarters.
The results also reflected strong sales of Copaxone, Teva's leading branded treatment for multiple sclerosis, it said.
"The high profitability resulted from a sharp improvement in gross profit margins due to the launch of new generic products in the United States and high margins on branded products," said Steven Tepper, an analyst at Harel Finance brokerage.
But sales outside the United States, excluding the Ratiopharm acquisition, were a bit lower than expected due to a lack of growth for Copaxone other than U.S. price hikes, and seasonal erosion in sales of respiratory products, he added.
"It is a strong report but it is important to hear what is happening in the European generic market," Tepper said.
Teva President and Chief Executive Shlomo Yanai said price pressures and price erosions, especially in Europe, for generic drugs were part of the business environment.
"As a market leader I believe we know how to manage this type of phenomenon and increase our market share to exceed the impact of price erosion," he said on a call with analysts.
Teva shares slipped 0.5 percent to $50.98 in early Nasdaq trade.
In the quarter, Teva completed its 3.7 billion euro acquisition of Germany's Ratiopharm, whose results were consolidated since August 2010.
EXCHANGE RATE HITS SALES
Quarterly earnings excluding one-time items rose 46 percent to $1.30 a share while sales rose 20 percent to $4.25 billion.
Exchange rate differences negatively impacted sales in the quarter by $122 million compared with a year ago though the effect on operating profit was negligible, Teva said.
Analysts on average expected Teva to earn $1.27 a share on sales of $4.37 billion, according to Thomson Reuters I/B/E/S.
Yanai lifted Teva's 2010 outlook for revenue to $16.4 billion from a previous $16 billion but left unchanged the forecast from July for EPS ex-items of $4.50-$4.60.
Yanai said this was a quarter of strategic achievements and operational successes, particularly in the United States with high growth rates in the generics business, and in Europe.
He said Teva expected to complete the integration of Ratiopharm ahead of schedule. Last week, Teva said it would buy Merck KGaA's women's health franchise outside the United States for 265 million euros.
Global sales of Copaxone, which has a 30 percent market share, rose 4 percent to a record $808 million. Copaxone sales outside the United States fell due to the timing of tenders in certain markets, the negative impact of exchange rates and containment measures in Europe.
Teva said it would pay a dividend of 0.7 shekel (19.3 cents) per share on Dec. 2, up from 0.6 shekel a year ago.
($1 = 3.62 shekels)
(Additional reporting by Steven Scheer; Editing by David Cowell)