Mylan Cuts View On Drug Delays -- WSJ
August 10 2017 - 3:02AM
Dow Jones News
By Imani Moise and Cara Lombardo
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (August 10, 2017).
Mylan NV cut its earnings forecast for the next year and a half
as the company faces increased competition from generic drugs and
delays in the launch of key drugs amid regulatory questions.
The company said it couldn't count on launching this year the
planned generic versions of Teva Pharmaceutical Industries Ltd.'s
Copaxone and GlaxoSmithKline PLC's Advair, after the Food and Drug
Administration asked for more information.
On a call with investors, the company blamed the delays on
restructuring at the FDA and said that it didn't expect the agency
to require any more clinical or device-related studies. "We
honestly see the administrative as the barrier and not the
science," said Chief Executive Heather Bresch.
Mylan would be the first company to bring a generic version of
Advair to the market and one of the first to bring a generic
version of Copaxone. The FDA has vowed to approve more generic drug
applications to encourage competition and lower prices, and has
said it is prioritizing the approval of the first generic version
of a drug. But Mylan President Rajiv Malik told investors Wednesday
that the FDA seems more focused on quickly approving subsequent
versions of generics.
An FDA spokeswoman said the agency is already implementing a
plan to streamline the generic drug review process and expects to
approve a record number of generics by the end of the year. She
said the agency is continuing to expedite the review of potential
first generics.
Chad Landmon, an attorney who helps generic drugmakers gain FDA
approval, said it has been a challenge for the FDA to prove generic
versions of both Copaxone and Advair function the same as branded
versions. Mr. Landmon, who doesn't work with Mylan, said this is
especially true with Advair because it is administered through an
inhaler.
Mylan executives said Wednesday that the company planned to
submit a response to the FDA's concerns regarding Advair in the
next few weeks.
Mylan also said it expects competition to erode prices for its
generic drugs, by a rate in the mid-single digits globally and
high-single digits in North America.
Competition from generic drugs has also hurt Mylan's brand-name
products. The company said North American sales for its EpiPen
Auto-Injector fell more than expected in the most recent quarter as
cheaper generic versions launched. North American sales slid 9%
overall in the quarter ended June 30; excluding EpiPen sales, they
grew 4%.
Mylan now expects revenue this year to come in between $11.5
billion and $12.5 billion, compared with prior guidance of $12.25
billion to $13.75 billion. It cut its forecast for earnings per
share to a range of $4.30 to $4.70, from $5.15 to $5.55 previously.
For 2018, the company now expects earnings per share of at least
$5.40, down from its earlier target of $6.
Umer Raffat, a senior analyst with Evercore ISI, estimated in a
research note that half of the revenue revision came from the delay
of new launches, while the rest stemmed from increased price
erosion and competition.
In all for the latest quarter, Mylan missed views, reporting
earnings of $297 million, or 55 cents a share, up from $168.4
million or 33 cents a share a year earlier. On an adjusted basis,
earnings fell to $1.10 a share from $1.16 a share. Revenue jumped
16% to $2.96 billion.
Analysts polled by Thomson Reuters had forecast earnings of
$1.16 per share on $3.04 billion in sales.
Shares closed at $32.08, up 29 cents, after opening 5.9%
lower.
Corrections & Amplifications The Food and Drug
Administration earlier this year asked for more information on
Mylan drugs in development. An earlier version of this article
incorrectly gave the name of the agency as the Federal Drug
Administration. (Aug. 9)
Write to Imani Moise at imani.moise@wsj.com
(END) Dow Jones Newswires
August 10, 2017 02:47 ET (06:47 GMT)
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