The spate of acquisitions in the pharmaceutical industry
) completing the purchase of the privately-held Cobrek
Pharmaceuticals, Inc. for approximately $45 million in
cash. The transaction has been inked on a cash free and debt free
MYLAN INC (MYL): Free Stock Analysis Report
PERRIGO COMPANY (PRGO): Free Stock Analysis
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We remind investors that Perrigo already owns 18.5% of Cobrek
Pharma through a deal signed in 2008. In December 2012, Perrigo
inked a definitive agreement to acquire the balance 81.5% stake
in the privately-held entity.
Per the terms of the deal, Cobrek Pharma, whose primary source of
income are the profit shares on offerings partnered with Perrigo,
will forgo payments related to profit shares earned during
Perrigo's fiscal second quarter 2013. We note that the company's
fiscal year ends on the last Saturday of June every year.
By acquiring the remaining stake in Cobrek Pharma, Perrigo aims
to strengthen its position in the topical foam-based generic
prescription pharmaceuticals space. The deal is expected to boost
Perrigo's adjusted earnings in fiscal 2013 by $0.04 per share.
We note that Perrigo also inked a deal with Cobrek Pharma in 2008
for developing the foam dosage versions of generic pharmaceutical
offerings. The partnership has worked very well and is
responsible for the development of two commercialized foam-based
products. The products are the generic versions of Evoclin
(clindamycin phosphate) foam 1% and Extina (ketoconazole) foam
Additionally, the deal has yielded two more foam-based products,
which have been cleared by the Food and Drug Administration (FDA)
but have not yet been launched. The products, expected to be
launched in fiscal 2013, are Luxiq (betamethasone valerate) foam
and Olux-E (clobetasol propionate) foam 0.05%.
We note that Perrigo has been quite active on the acquisition
front lately. Earlier in 2012, Perrigo acquired the entire assets
of privately-held Sergeant's Pet Care Products, Inc. Through this
acquisition, Perrigo aimed to diversify its business into the
lucrative pet care space.
Currently, we have a long-term Neutral recommendation on Perrigo,
an S&P 500 stock. The stock carries a Zacks #3 Rank (Hold) in
the short run. S&P 500 companies that currently look
). Mylan carries a Zacks #2 Rank (Buy).