Mylan Launches Generic Lipitor - Analyst Blog


Mylan Pharmaceuticals Inc., a subsidiary of generic pharma major Mylan Inc. ( MYL ), recently announced that it has received final approval from the US Food & Drug Administration (FDA) for its generic version of Pfizer's ( PFE ) Lipitor (atorvastatin). Mylan has already begun shipping the product.

Lipitor is used as an adjunct to diet in patients with primary hypercholesterolemia and mixed dyslipidemia to reduce elevated total cholesterol, low-density lipoprotein (LDL), and triglycerides and to increase high-density lipoprotein (HDL) cholesterol. According to IMS Health, Lipitor generated US revenues of approximately $8.1 billion for the 12 months ending March 31, 2012.

Earlier this month, Mylan had launched generic Lipitor in France, Belgium, the UK, the Netherlands and Ireland. In these countries, Lipitor generated total sales of $1.6 billion for the 12 months ending December 31, 2011.

As of May 29, 2012, the company had 171 abbreviated new drug applications (ANDAs) pending clearance by the FDA, targeting $84 billion in sales annually. Mylan believes that about 38 of these ANDAs are first-to-file opportunities, representing approximately $25.5 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 2017-2018, we have little visibility on the growth prospects for 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 #3 Rank (Hold 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: LDL , MYL , PFE

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