Sector News

Allergan CEO says company is urgently looking at all options to boost share price

May 8, 2019
Life sciences

Allergan Plc Chief Executive Brent Saunders said on Tuesday that he and the board of directors were looking with a sense of urgency at all options to revive the Botox maker’s falling share price, but a lack of specifics failed to boost investor sentiment.

Allergan shares fell more than 4 percent despite reporting better-than-expected first-quarter profit and raising its 2019 sales and earnings forecasts, more than twice the drop in the broader markets. They are trading nearly 60 percent below their 2015 high of about $340.

“We leave the first-quarter call with even less confidence that value in Allergan will be unlocked over the near term; catalysts are few, as are reasons to expect shares to move higher,” said RBC Capital Markets analyst Randall Stanicky.

Allergan shareholders last week voted down a non-binding proposal by activist investors that sought an immediate split of the CEO and chairman roles, but it was hardly a resounding victory for Saunders. Nearly 40 percent of shareholders backed the proposal.

Saunders said the board had talked to more than 50 shareholders recently and heard a common theme of frustration with the company’s falling stock price.

“I assure you that the board, management team and I recognize the urgency, and we will take decisive action to drive value-enhancing opportunities,” Saunders promised.

However, he did not outline any steps the board was considering, saying “everything is on the table.”

Excluding items, the company earned $3.79 per share, topping analysts’ average estimates by 24 cents, according to Refinitiv IBES data.

The company now expects 2019 adjusted profit to be greater than $16.55 per share, up from its prior expectation of greater than or equal to $16.36.

“The guidance they put out for full-year basically includes the beat in first quarter and doesn’t carry anything beyond that,” said Kevin Kedra, an analyst with Gabelli & Co, which owns Allergan’s shares.

Earnings were helped by a delay in generic competition for dry-eye drug Restasis. The company expects generic competition for Restasis later this month.

Botox sales, including cosmetic and prescription uses, rose 6.3 percent to $868.4 million, while Restasis sales fell 11.7 percent to $242 million, primarily due to lower net pricing.

U.S. sales of CoolSculpting, which removes fat non-surgically fell 27.8 percent to $62.9 million.

Revenue fell 2 percent to $3.59 billion in the quarter.

Allergan forecast 2019 sales between $15.13 billion and $15.43 billion, compared with its prior range of $15.00 billion to $15.30 billion.

By Manojna Maddipatla and Manas Mishra

Source: Reuters

comments closed

Related News

September 12, 2021

Sanofi to buy Kadmon for $1.9B, extending deal streak

Life sciences

The deal, announced Wednesday, has Sanofi paying $9.50 per share in cash for Kadmon, a roughly 77% premium to the biotech’s Tuesday closing price and 113% more than its average trading price over the last two months.

September 12, 2021

GSK, Pfizer and Johnson & Johnson race toward $10B-plus RSV vaccine market: analyst

Life sciences

RSV, or respiratory syncytial virus, has long been a top target for vaccine developers. While companies have suffered high-profile trial failures over the years, vaccines are now advancing through late-stage testing and could launch in 2023, SVB Leerink analyst Geoffrey Porges wrote to clients this week.

September 12, 2021

Google, Mayo Clinic build new type of AI algorithm to map interactions between areas of the brain

Life sciences

By monitoring which areas of the brain responded to localized electrical stimulation, scientists from the Google Research Brain Team and Mayo Clinic developed an artificial intelligence algorithm to map out the structure of brain networks.

Send this to a friend