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Dec. 22, 2015, 7:54 AM
- Noting significant short interest and recent selloffs, analyst Randall Stanicky makes INSY and SGNT his top "out of consensus" picks for 2016. INSY's short interest is 46% of the float and SGNT's is 4.4%.
- Though M&A will continue next year, there will be greater deal scrutiny and fewer targets, and Stanicky favors the targets vs. the accretive acquirers.
- Mylan (NASDAQ:MYL) and Impax Labs (NASDAQ:IPXL) are seen as most likely to pursue "transformative" deals, while Teva (NYSE:TEVA), Perrigo (NYSE:PRGO), Sagent, Eagle (NASDAQ:EGRX), Depomed (NASDAQ:DEPO), and Endo (NASDAQ:ENDP) are likely to pursue bolt-on purchases.
- Most likely targets: Akorn (NASDAQ:AKRX) and Flexion (NASDAQ:FLXN).
- Top large-cap picks: Endo and Teva.
- Related: 45% Upside For 2016's Top Takeover Target (Dec. 1)
Dec. 17, 2015, 10:12 AM
- Perrigo (PRGO -0.9%) acquires a portfolio of generic dosage forms and strengths of the topical acne treatment Retin-A (tretinoin) from privately held Matawan Pharmaceuticals, LLC for an undisclosed sum. Generic and branded sales of Retin-A were ~$287M for the 12-month period ending in October.
- The deal, expected to be finalized in Q1, should immediately exceed Perrigo's internal investment hurdle rate and add more than $0.20 to non-GAAP EPS within the first year post close.
Dec. 15, 2015, 1:34 PM
- In a regulatory filing, AstraZeneca (AZN +0.9%) reports that it has completed its divestment of Entocort (budesonide) with the finalization of its agreement with Perrigo (PRGO +0.6%) for the U.S. rights to the Crohn's disease medicine, for which Perrigo paid $380M.
- Zeria Group's Tillotts Pharma AG owns the rights outside of the U.S. for which it paid $215M.
- Previously: AstraZeneca, Perrigo sign deal for rights to Entocort (Nov. 23)
- Previously: AstraZeneca divests non-U.S. rights to Entocort for $215M (July 9)
Dec. 11, 2015, 4:25 PM
- Voyager Therapeutics (NASDAQ:VYGR) initiated with Outperform rating and $36 (52% upside) price target by Wedbush.
- Perrigo (NYSE:PRGO) upgraded to Buy from Hold with $170 (15% upside) price target by Argus.
- Myriad Genetics (NASDAQ:MYGN) upgraded to Neutral from Sell by Goldman Sachs. Price target raised to $94 (123% upside) from $72.
- Abbott Laboratories (NYSE:ABT) upgraded to Buy from Hold by Jefferies. Price target raised to $55 (24% upside) from $49.
- Eli Lilly (NYSE:LLY) upgraded to Buy from Hold by Deutsche Bank. Price target raised to $99 (19% upside) from $85.
- PerkinElmer (NYSE:PKI) downgraded to Sell from Neutral. Price target lowered to $44 (12% downside risk) from $55. LabCorp (NYSE:LH) downgraded to Neutral from Buy. Price target lowered to $126 (4% upside) from $142. Danaher (NYSE:DHR) downgraded to Neutral from Buy. Price target lowered to $103 (11% upside) from $104. All by Goldman Sachs.
- Bluebird bio (NASDAQ:BLUE) downgraded to Equal Weight from Overweight by Morgan Stanley. Price target lowered to $69 (16% upside) from $143. Maintained at Outperform by Wedbush. Price target lowered to $117 (96% upside) from $165. Downgraded to Neutral from Buy by Roth Capital. Price target lowered to $62 (4% upside) from $121. Maintained at Overweight at Piper Jaffray. Price target unchanged at $204 (242% upside).
Nov. 23, 2015, 3:56 AM
- AstraZeneca (NYSE:AZN) has finalized plans to divest its Crohn's disease drug Entocort by selling U.S. rights to the medicine to Perrigo (NYSE:PRGO) for $380M.
- The move is part of AstraZeneca's "externalization" drive, which aims to sell non-core products to help it fill a short-term revenue gap caused by older drugs, while investing in a pipeline of new medicines.
- Entocort had U.S. sales of $89M in the first nine months of 2015.
Nov. 16, 2015, 12:26 PM
Nov. 13, 2015, 9:44 AM
- Perrigo (PRGO -6.9%) confirms that Mylan (MYL +10.6%) failed to gain tender commitments for at least half of Perrigo's shares in its bid for the company. As of the deadline this morning at 8:00 am ET, less than 40% of PRGO stockholders had tendered shares.
- Chairman & CEO Joseph Papa says, "We have said all along that this offer from Mylan was a bad deal for our shareholders, as its significantly undervalued our durable business model and industry-leading future growth prospects. Strong organic growth, a disciplined approach to M&A and transparent, accessible corporate governance policies are the foundation of our successful business strategy. I am delighted that Perrigo shareholders voiced their clear support for this management team and our long-term strategy, highlighted by our "Base Plus Plus Plus" growth model. Now that the Mylan tender offer is behind us, we look forward to continuing to create significant value for our shareholders. Our confidence in Perrigo's compelling near- and longer-term growth prospects and our steadfast commitment to delivering returns to shareholders remain unchanged. Even with all the distractions over the past seven months, our unrivaled team has executed our strategy and continued our commitment to delivering Quality Affordable Healthcare Products to customers and patients across the globe."
- The company will immediately begin its previously announced $2B stock repurchase program with a buy back of $500M by year end.
Nov. 13, 2015, 9:14 AM
Nov. 13, 2015, 7:54 AM
- To no one's surprise, it appears that Mylan (NASDAQ:MYL) will come up short in its effort to get Perrigo (NYSE:PRGO) stockholders to tender at least 50% of the company's outstanding shares by this morning. The deal was $75 in cash plus 2.3 MYL shares for each PRGO share. Based on yesterday's closing prices, Mylan's bid is valued at $174.36, a modest 11.4% premium over Perrigo's closing price of $156.55.
- PRGO shareholders appear to agree that Mylan's bid was too low.
- In premarket trading, MYL is up 11% and PRGO is down 11%, both on robust volume.
Nov. 12, 2015, 10:43 PM
- With an 8 a.m. deadline looming, Mylan (NASDAQ:MYL) is set to lose in its $26B hostile bid for Perrigo (NYSE:PRGO), with a minority of shareholders tendering their holdings, sources tell The Wall Street Journal.
- Shares could keep coming in by morning -- but most institutional shareholders had to tender by tonight to be counted by the DTC clearinghouse, so the result may be a foregone (but surprising) conclusion.
- Mylan needs to hit the 50% threshold to take control.
- Mylan's been engaged in a pitched seven-month pursuit of the generic-drug maker, full of back-and-forth sniping between boards and execs.
- Previously: U.S. FTC OKs Mylan's intended takeover of Perrigo (Nov. 03 2015)
- Previously: Mylan discloses SEC subpoena; Perrigo issues new broadside against bid (Oct. 30 2015)
Nov. 10, 2015, 9:00 AM
- The FDA approves Perrigo's (NYSE:PRGO) generic version of Upsher-Smith Labs' KlorCon (potassium chloride) extended-release tablets (600 mg and 750 mg) that are marketed by Sandoz Pharmaceuticals (NYSE:NVS). The product is indicated for the treatment of hypokalemia (low levels of potassium in the blood).
- The U.S. market for the both generic and branded offerings is ~$81M.
Nov. 4, 2015, 8:54 AM
- Perrigo (NYSE:PRGO) declares $0.125/share quarterly dividend, in line with previous.
- Forward yield 0.31%
- Payable Dec. 15; for shareholders of record Nov. 27; ex-div Nov. 24.
Nov. 3, 2015, 6:52 PM
- The U.S. Federal Trade Commission (FTC) clears Mylan's (NASDAQ:MYL) proposed acquisition of Perrigo (NYSE:PRGO) subject to Mylan divesting certain products following the close of the deal. The FTC's action is the final regulatory hurdle needed by Mylan to close the transaction.
- There is a bit of work remaining, though, since Perrigo has repeatedly stated that Mylan's offer of $75 per share plus 2.3 shares of MYL for each PRGO share is grossly inadequate. It continues to urge its stockholders not to tender shares. The deadline to do so is 8:00 am ET on November 13.
Oct. 30, 2015, 5:19 PM
- Mylan (MYL -3.7%), down 0.2% after hours, says in its 10-Q filing that on Sept. 10, it got a subpoena from the SEC "seeking documents with regard to certain related party matters."
- "Mylan is cooperating with the SEC in its investigation, and we are unable to predict the outcome of this matter at this time," the company says of the subpoena.
- Mylan issued a Friday night document dump related to its hostile Perrigo (PRGO -4.9%) bid.
- Perrigo reacted predictably to Mylan's latest earnings presentation, again calling the offer "grossly inadequate" and saying the presentation appeared "PRGO)+Comments+on+Mylan+(NASDAQ:MYL)+Presentation%3B+Says+it+Appeared+Unconvincing/11020465.html" target="_blank">unconvincing." Perrigo still strongly recommends its shareholders avoid tendering into Mylan's deal.
- "Mylan is avoiding the real measures that shareholders look to, such as actual takeover premiums and Perrigo's durable high trading multiple, and instead invents new concepts – such as 'hypothetical' share prices and 'accretion' to target shareholders," Perrigo's statement read.
- Previously: Perrigo strikes out with NY court in attempt to block Mylan bid (Oct. 30 2015)
- Previously: Mylan fails to impress analysts on the merits of its bid for Perrigo (Oct. 14 2015)
Oct. 30, 2015, 8:39 AM
- The U.S. District Court for the Southern District of New York denies Perrigo's (NYSE:PRGO) motion for a preliminary injunction to block Mylan's (NASDAQ:MYL) hostile takeover bid, ruling that Mylan had provided adequate public disclosures regarding the synergies expected from the combination of two firms. It also ruled that Mylan's disclosures pertaining to its plan to delist Perrigo from the NYSE and TASE as soon as practicable following the merger were appropriate.
- Mylan's offer is $75 plus 2.3 MYL shares for each PRGO share. Based on yesterday's closing for MYL, the offer is valued at $180.29, less than a 9% premium over PRGO's closing price of $165.81.
Oct. 22, 2015, 10:17 AM
- Perrigo Company (PRGO -2.5%) Q3 results: Revenues: $1,344.7M (+41.3%); COGS: $795.9M (+26.4%); R&D Expense: $41.6M (+13.7%); SG&A: $291.5M (+121.0%); Operating Income: $188.6M (+37.5%); Net Income: $112.6M (+16.9%); EPS: $0.77 (+6.9%); Quick Assets: $182M (+83.7%).
- 2015 Guidance: Adjusted EPS: $7.65 - 7.85.
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