The US Food and Drug Administration (FDA) recently approved Perrigo Company’s (PRGO) Abbreviated New Drug Applications (ANDAs) to market over-the-counter nicotine polacrilex mini lozenge, 2 mg (mint flavor) and 4 mg (mint flavor). Perrigo expects to start shipping the product by year end.
Mini nicotine lozenges help to reduce withdrawal symptoms like nicotine craving, associated with quitting smoking. This is the first approval for mini lozenge products targeting the store brand market. The mint flavored mini lozenge can be compared to GlaxoSmithKline's (GSK) Nicorette mini lozenge.
We note that Glaxo markets Nicorette (Original, Mint and Orange) globally. Perrigo stated in its press release that annual sales of Nicorette mini lozenge are more than $30 million at all retail outlets.
We remind investors that last month Perrigo filed an ANDA with the FDA, seeking approval for its generic version of Teva Pharmaceutical Industries Limited’s (TEVA) ProAir HFA inhaler. The application included contributions from Perrigo’s partner on the project, the privately-held Catalent Pharma.
Teva is challenging Perrigo’s application, thereby initiating the litigation process under the Hatch-Waxman Act. Perrigo is the first company to seek approval for the generic version of the drug and is therefore entitled to 180 days of generic exclusivity.
We also note that the generic unit at Perrigo has seen quite a few approvals over the past few months including its generic versions of Clobex shampoo, inflammatory acne therapy Duac gel, hyperphosphatemia drug, Phoslo Gelcaps and vaginal cream Gynazole 1 for the local treatment of vulvovaginal candidiasis.
Our Recommendation
We currently have a Neutral recommendation on Perrigo. The stock carries a Zacks #3 Rank (Hold) in the short run.
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