Mylan's third-quarter 2014 earnings of $1.16 per share increased
41.5% year over year and beat the Zacks Consensus Estimate by 2
cents. Revenues climbed 17.9% to $2.08 billion. Mylan's
third-quarter results were better than expected with the company
beating on both earnings and revenues, driven by strong sales in
North America and the Specialty segment. We are looking forward to
the potential launch of generic versions of Copaxone and Lidoderm,
which should boost revenues further. We remain positive on Mylan's
deal with Abbott Labs, which is expected to close in the first
quarter of 2015. The deal is expected to be immediately and
significantly accretive. Based on these factors we upgrade our
recommendation on Mylan to Outperform.
Canonsburg, PA-based Mylan Inc. specializes in the development,
manufacture, marketing, and distribution of generic, branded, and
branded generic pharmaceutical products, as well as active
pharmaceutical ingredients (APIs). The company, which operates in
about 140 countries and territories, is one of the leading generic
and specialty pharmaceutical companies in the world. Mylan's
product portfolio encompasses various therapeutic areas including
cardiovascular, central nervous system, anti-infective,
gastrointestinal, endocrine and metabolic, and respiratory
Mylan also has a Specialty business, which focuses on medicines
for respiratory, allergy and psychiatric conditions. Through its
controlling interest in its Indian subsidiary, Mylan Laboratories
Limited (formerly known as Matrix Laboratories Limited), Mylan has
direct access to one of the largest active pharmaceutical
ingredients (API) manufacturers in the world. Mylan Laboratories
also engages in the supply of APIs for the manufacture of
antiretroviral (ARV) drugs used in the treatment of HIV. Meanwhile,
the acquisition of Merck KGaA's generic business, Merck Generics
(MG), in Oct 2007 has allowed Mylan to expand its global
Mylan has been constantly making acquisitions to drive growth.
In Sep 2010, Mylan acquired privately held Bioniche Pharma Holdings
Ltd, which provided it with access to the North American injectable
drugs market. Mylan has combined Bioniche Pharma with its own unit
dose business, UDL Laboratories, to form a new unit called Mylan
Institutional, which is a part of the company's North American
generics segment. Mylan has also entered the biologics space by
striking a partnership with India-based Biocon Ltd. In Feb 2013,
Mylan extended its partnership with Biocon. The companies signed a
definitive agreement to develop and commercialize the generic
versions of three insulin analog products. In Jan 2014, Mylan
launched its biosimilar version of Roche's breast cancer drug
Herceptin (trastuzumab) in India. Mylan has co-exclusive rights
with Biocon to market the drug in India.
In Nov 2011, Mylan entered into an agreement with Pfizer whereby
the latter granted Mylan exclusive global rights to develop,
manufacture and commercialize Pfizer's generic version of
GlaxoSmithKline's respiratory drugs, Advair and Seretide, utilizing
Pfizer's respiratory delivery platform.
In Aug 2012, Mylan joined forces with Pfizer to develop,
manufacture, distribute and commercialize generic drugs in Japan.
The companies entered into an agreement to form an exclusive
long-term strategic collaboration.
In Sep 2012, Mylan entered into a settlement agreement with
Pfizer, Pharmacia & Upjohn Company LLC and Pfizer Health AB.
The patent litigation was related to Mylan's generic version of
Pfizer's Detrol LA (tolterodine tartrate ER, 2 mg and 4 mg) for
overactive bladder with symptoms of urge urinary incontinence,
urgency and frequency. In 2013, Mylan acquired the rights to a
novel LAMA respiratory compound from Pfizer for multiple
Mylan has entered into an agreement with Abbott Laboratories to
buy the latter's branded specialty and generics business in the
developed ex-U.S. markets, which is expected to close in the first
quarter of 2015. On Oct 21, 2014, Mylan amended the agreement,
which is expected to result in additional accretion. The deal is
expected to be immediately and significantly accretive to the
Mylan reported $6.91 billion in total revenues in 2013, up 2%
year over year.
Currently, Mylan reports revenues from two segments:
Generics (including the Indian subsidiary Mylan Laboratories)
This segment primarily develops, manufactures, sells and
distributes generic or branded generic pharmaceutical products in
tablet, capsule injectable or transdermal patch forms. In addition,
the segment is engaged in the manufacture and sale of APIs.
Generics revenues are derived from sales in North America, Europe,
the Middle East and Africa (collectively, EMEA), and Asia Pacific.
The company derives the majority of its revenues from this segment.
In 2013, third party net revenues from the Generics unit were $5.87
billion, down 1% due to an unfavorable foreign exchange impact.
Specialty Under this segment, Mylan markets branded specialty
nebulized and injectable products for life-threatening conditions.
In 2013, the Specialty segment recorded revenues of $981.7 million,
up 17.6% from the prior year. The most significant product in this
segment is EpiPen Auto-Injector, used to treat severe allergic
reactions like anaphylaxis. Mylan and Pfizer have an agreement for
EpiPen under which Pfizer manufactures and Mylan markets the
Mylan, Inc. (MYL): Read the Full Research
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
MYLAN INC (MYL): Free Stock Analysis Report
To read this article on Zacks.com click here.