Mylan looks to 2014 for big growth
Mylan CEO Heather Bresch is looking forward to next year. After having red-hot earnings reports last year, the more lackluster results in 2013 have been a disappointment. The company ($MYL) reported a 25% drop in net profit and a 2% falloff in sales for its third quarter. But Bresch promises the generic drugmaker will return to form in 2014, and analysts are taking her at her word.
"We are even more confident today in delivering the 2014 financial targets of 12% growth in our top line and 19% growth in our bottom line," Bresch said Thursday.
Standard & Poor's analyst Herman Saftlas tells the Pittsburgh Tribune-Review that the third quarter was disappointing but sees it as an anomaly. "The core drivers are on track, and they have consistently delivered on their projections and their guidance," he said.
Leerink Swann analyst Jason Gerberry today was telling investors there really doesn't look like anything to worry about. He said in a note to investors that the profit miss was largely overcome by the company's plans to buy back $500 million in shares, while the sales shortcomings seemed to be the result of a slowdown by the FDA in approving generic drug applications. "We continue to like the opportunity for growth next year," Gerberry said, particularly for the possible approvals for generic Lidoderm and Copaxone, Teva Pharmaceutical Industries' ($TEVA) blockbuster multiple sclerosis drug.
Mylan also has to look forward to the contribution from its $1.6 billion buyout of Agila Specialties, the sterile injectables business of India's Strides Arcolab. The company said that deal is on schedule to close this quarter. Execs assured investors that a warning letter--one of the 8 the Agila plant got recently from the FDA--is not a serious concern. That deal will make Mylan one of the world's largest producers of sterile injectables drugs at a time when that market is growing significantly.
The company reported sales in the third quarter from new product launches totaled $108 million, 65% below the $299 million in the same quarter a year ago, but it said that had much to do with the FDA not being on the same pace it was last year for approving generic drugs. It narrowed its 2013 sales estimates to a range of $2.80 to $2.90 a share.