Perrigo (NASDAQ:PRGO) Still Shrouded in Uncertainty

Perrigo Co. (NASDAQ:PRGO) still has a lot of uncertainty on several fronts, including whether or not PRGO/Synthon will be fully exclusive.

Needham, which maintains a "Hold" rating on Perrigo, said, "PRGO announced approval and launch of two new generics, Naproxen Sodium Soft Gels, equivalent to Aleve Liquid gels, an $80.0MM OTC analgesic and levocetirizine, an Rx equivalent to Xyzal, a $220.0MM allergy drug. Both products were expected new launches in FY2011 and are, we believe, largely “in the numbers” with respect to company guidance.

"Though generic Xyzal was in full-year 2011 guidance, we don’t know how conservative the management’s assumptions were in terms of timing or whether partner Synthon would launch with still unresolved litigation.

"There is still some lingering uncertainty on whether PRGO/Synthon will actually realize their full exclusivity as several generics are attempting to “carve-out” labeling around primary indication which would enable immediate launch. Innovator UCB (N/R) has filed a Citizen’s Petition to block this effort. While the inability to fully realize 180-day exclusivity would no doubt result in lighter-than-forecast contribution from generic Xyzal given the small expected full-year contribution, we wouldn’t expect an impact on current full-year EPS guidance even in this downside case."

Perrigo closed Tuesday at $60.24, falling $0.77, or 1.26 percent.