More Generic Launches at Mylan - Analyst Blog


Mylan Inc. ( MYL ) recently announced that it has launched its generic version of Merck's ( MRK ) Clarinex (desloratadine) 5 mg tablets after receiving final approval from the US Food & Drug Administration (FDA).

Clarinex is approved for seasonal allergic rhinitis, perennial allergic rhinitis and chronic idiopathic urticaria. According to IMS Health, Clarinex (5 mg tablets), generated US revenues of approximately $194.6 million for the 12 months ending March 31, 2012.

Meanwhile, Mylan also received final FDA approval for its generic version of Noven Therapeutic's Lithobid (lithium carbonate) extended-release 300 mg tablets. Lithobid is approved for manic episodes associated with bipolar disorder. The product is also approved as a maintenance therapy for bipolar disorder patients in order to reduce the frequency and intensity of manic episodes.

As per IMS Health data, Lithobid 300 mg generated US revenues of approximately $21 million for the 12 months ending March 31, 2012.

Mylan has begun shipping both products.

As of July 3, 2012, Mylan had 167 Abbreviated New Drug Applications (ANDAs) pending FDA clearance, targeting $83.8 billion in branded sales annually. Mylan believes that about 37 of these ANDAs are first-to-file opportunities, representing approximately $25.6 billion in branded sales. The revenue figures are as per IMS Health for the 12 months ending December 31, 2011.  

Our Recommendation

We are encouraged by Mylan's geographic reach and product depth along with a robust generic product pipeline.

However, we are concerned about the company's lackluster performance in the Europe, Middle East and Africa (EMEA) region. Additionally, with most large branded drugs due to lose patent exclusivity within the 2017-2018 period, we have little visibility on the growth prospects of generic companies like Mylan beyond that timeframe.

Thus, we prefer to remain on the sidelines and have a Neutral recommendation on Mylan. The stock carries a Zacks #2 Rank (Buy rating) in the short term.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: MRK , MYL

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