Par Pharmaceutical Companies Inc. (PRX) recently announced that it has acquired rights to three products from Teva Pharmaceutical Industries Ltd. (TEVA), following the latter’s acquisition of Cephalon.
According to the terms of the deal, Par Pharma took over the abbreviated new drug applications (ANDA) of fentanyl citrate lozenges, the generic version of Actiq, and cyclobenzaprine ER capsules, the generic version of Amrix. Additionally, Par Pharma purchased the US rights to market modafinil tablets, the generic version of Provigil. All these drugs were a part of Cephalon’s portfolio, before the Teva-Cephalon merger.
While Actiq sales amounted to $63.93 million, for the year ended December 31, 2010, Provigil and Amrix sales came in at $1.06 billion and $109.2 million respectively.
These products will be significant additions to Par Pharma’s generic product portfolio/pipeline. We note that Par Pharma has been busy acquiring companies and signing new deals to build its pipeline.
In August 2011, the company announced its intention to acquire Anchen Pharmaceuticals for $410 million in cash. With this acquisition, which is scheduled to close by the end of 2011, Par Pharma will gain access to Anchen’s product portfolio.
Anchen’s portfolio consists of five marketed products, 27 ANDAs that have been filed with the US Food and Drug Administration (FDA) including five potential first-to-file applications, and about 26 products in development.
Earlier, in May 2011, Par Pharma announced its intention to acquire India-based generic company Edict Pharmaceuticals. Edict Pharmaceuticals has seven ANDAs filed with the FDA and one ANDA filed in the name of a development partner, along with 14 additional products in development.
We note that these transactions will add to Par Pharma’s portfolio, helping boost the company’s revenues, which amounted to $224.2 million in the second quarter of fiscal 2011, 12.3% below the year-ago figure of $255.5 million. Lower sales of the company’s generic products primarily led to the decline. (Read our full coverage on the earnings at: Lower Spending Boosts Par Pharma)
We currently have a Neutral recommendation on Par Pharma. The stock carries a Zacks #3 Rank (Hold rating) in the short run.
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