By Saabira Chaudhuri
Valeant Pharmaceuticals International Inc. (VRX, VRX.T) said it will launch a generic version of its Zovirax ointment Thursday after Mylan Inc. (>> Mylan Inc.) received approval to launch a similar product, a move that is expected to cut the specialty-pharmaceutical company's earnings this year.
Valeant's Zovirax ointment is indicated for use against herpes viruses. Mylan's product is the first generic version.
"While the timing of a generic approval was always uncertain, this was not unforeseen and we were prepared," Chief Executive J. Michael Pearson said.
Valeant added it didn't include the event in its budget expectations and expects it hurt per-share cash earnings by 30 cents to 40 cents in 2013.
However, the company noted that several product acquisitions, the repricing of its term-loan debt and other events that have occurred since it provided financial guidance in January will likely mitigate the impact of the generic Zovirax ointment.
Mylan said Wednesday it had received final approval from the U.S. Food and Drug Administration for its Abbreviated New Drug Application for Acyclovir Ointment USP, 5%.
Valeant--a specialty pharmaceutical company that makes products primarily in the areas of dermatology, neurology and branded generics--is based in Montreal. Last month, the company said it had agreed to acquire Obagi Medical Products Inc. (>> Obagi Medical Products, Inc.) for about $360 million, a deal expected to supplement Valeant's presence in the dermatology and plastic-surgery sectors. Then earlier this week, Valeant agreed to raise its offer for Obagi by 22%, topping Merz Pharma Group's recently disclosed bid for the specialty pharmaceutical company.
Shares closed Wednesday at $71.87 and were inactive premarket. The stock has risen 33% in the past 12 months.
Write to Saabira Chaudhuri at email@example.com