Par Pharma Launches Generic Provigil

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Par Pharmaceutical Companies Inc. (:PRX) recently announced that it has commenced the shipment of a generic version of Provigil, approved for improving wakefulness in patients with excessive sleepiness associated with narcolepsy, obstructive sleep apnea/hypopnea syndrome and shift work sleep disorder.

Par Pharma had acquired the US rights to market generic Provigil from Teva Pharmaceutical Industries Ltd.’s (TEVA) in October 2011, following Teva’s acquisition of Cephalon.

Annual US sales of Provigil amounted to $1.1 billion, according to IMS Health data.

We note that according to the US Food and Drug Administration (:FDA), Teva alone is entitled to 180-day exclusivity of generic Provigil as it was the first-to-file.

Apart from the US rights to generic Provigil, Par Pharma had also acquired the abbreviated new drug applications (ANDA) for generic Actiq and generic Amrix from Teva. These products are significant additions to Par Pharma’s generic product portfolio/pipeline.

Meanwhile, Par Pharma has been busy acquiring companies and signing new deals to build its pipeline. In February, the company completed the acquisition of India-based generic company Edict Pharmaceuticals. Par Pharma paid $20.5 million at the close of the transaction along with a debt repayment of $4.4 million.

Edict Pharma, located in Chennai, India, develops and manufactures solid oral dosage generic pharmaceuticals and currently has 11 ANDAs filed with the FDA.

Earlier, in November 2011, Par Pharma had acquired Anchen Pharmaceuticals for $410 million in cash. Anchen Pharma’s portfolio consists of five marketed products, 27 ANDAs filed with the FDA, five of which are believed to be first-to-file, and about 26 products in development.

We note that these transactions will add to Par Pharma’s portfolio, boosting the company’s revenues, which amounted to $926.1 million in 2011, 8.3% below the year-ago figure of $1.01 billion. Lower sales of the company’s generic products primarily led to the decline. (Read our full coverage on the earnings at: PRX Outperforms; Reaffirms Guidance)

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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