Teva expects Allergan deal close any day, it says while lifting guidance
Teva and Allergan are extending the deadline once again for their $40.5 billion generics deal--but investors needn’t fear, Teva said Wednesday.
Erez Vigodman, CEO of the Israeli generics leader, told shareholders on a conference call that the company expects the delayed transaction to close any day now, commentary that put shares on the rise.The edit, which pushes the deal deadline back to Oct. 26 from July 26, “is to give Allergan additional security,” Bernstein analyst Ronny Gal wrote in a Wednesday note to clients. Allergan is also now planning to exclude two products from the sale--Actonel and Carafate--and will cut down the amount of cash it shells out by $221 million. But “it does not mean there is a delay to the close,” Gal said.And that’s good news for nervous investors, who have been waiting with bated breath for the deal--struck last summer--to finally wrap up. The companies originally predicted Teva would have successfully swallowed Allergan’s generics unit by this year’s Q1, but FTC scrutiny has held up the process and forced several divestments.The agreement-tweaking came along with new guidance for 2016 through 2019, with Teva unveiling numbers Gal called “high.” The company now expects $22 billion to $22.5 billion in 2016 revenue; $25.2 billion to $26.2 billion in 2017 revenue; $25.8 billion to $26.9 billion in 2018 revenue; and $26.7 billion to $27.8 billion in 2019 revenue. It also raised its Q2 sales expectations, forecasting $4.9 billion to $5 billion--up from the $4.8 billion to $4.9 it previously predicted.Now, it’ll be up to the Petah Tikva-based drugmaker to show it can hit its marks, Gal said--but its history doesn’t say a whole lot for that prospect.“If Teva is able to meet the expectations they projected today, then we’ll be seeing fantastic execution. The problem is that the numbers are high vs. Teva’s trendline, and there is some degree of a ‘show me’ story based on Teva not having a very strong history of delivery,” he wrote.by Carly Helfand |
Source: http://www.fiercepharma.com/
