Valeant Pharmaceuticals Intl Inc. (NYSE:VRX) announced that its partner AstraZeneca AZN has...

Valeant Pharmaceuticals Intl Inc. (NYSE:VRX) announced that its partner AstraZeneca AZN has amended the company’s license


Valeant Pharmaceuticals Intl Inc. (NYSE:VRX) announced that its partner AstraZeneca AZN has amended the company’s license to its pipeline candidate, brodalumab.

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As per the amendment, AstraZeneca has decided to terminate Valeant’s rights to develop and commercialize brodalumab in Europe. We note that brodalumab, an IL-17 receptor monoclonal antibody, is currently under regulatory review for the treatment of patients with moderate-to-severe plaque psoriasis.

The companies had inked the agreement in Aug 2015, which granted Valeant an exclusive license to develop and commercialize brodalumab globally, other than Japan and certain other Asian countries.

However, as per the amended agreement, Valeant will continue to hold the license to develop and commercialize brodalumab in the U.S. and the remainder of the territory outside Europe. In lieu of the termination of rights in Europe, AstraZeneca will pay an upfront fee to Valeant, along with certain sales-based milestone payments. Additionally, one of the pre-launch milestones, which would be paid by Valeant to AstraZeneca, has been reduced.

Earlier, in 2016, FDA accepted the Biologics License Application (BLA) brodalumab for review, as submitted by AstraZeneca and Valeant, and assigned a Prescription Drug User Fee Act (PDUFA) action date of Nov 16, 2016. The Dermatologic and Ophthalmic Drugs Advisory Committee is scheduled to review the BLA on July 19.

With the termination of Valeant’s rights, the company will now focus on the approval and commercialization of brodalumab in the U.S. Meanwhile, AstraZeneca has granted LEO Pharma the rights to develop and commercialize brodalumab in Europe.

Valeant Equity Analysis

Valeant Pharmaceuticals Intl Inc. (NYSE:VRX) opened trading today as $23.06 and is trading in the range of 19.61-23.14 today. Valeant’s current market cap stands at $7.91 billion.

Valeant is currently covered by 23 Wall Street analysts.  The mean target price is $42.89 according to First Call.  This presents a solid upside to the current price of the equity.  The Mean Recommendation sits at 3.0 which is based on 3 Strong Buy, 2 Buy and 10 Hold ratings.

The most recent analyst actions consisted of Barclays downgrading the stock on March 21st and Mizuho initiating coverage with a downgrade rating back in March.

The current quarter EPS revenue estimates is 2.47B.  Sales are expected to drop at a 9.70% rate.  Valeant reported actual earnings last quarter of 1.27 which fails to beat the 1.37 consensus estimate, a -7.30% surprise.

Corporate Profile

Valeant Pharmaceuticals International, Inc. develops, manufactures, and markets pharmaceuticals, over-the-counter products, and medical devices worldwide. The company offers Solodyn to treat red and pus-filled pimples of acne in patients, as well as Ziana, Acanya, Atralin, Retin- A Micro, and ONEXTON gel; Wellbutrin XL for major depressive disorder in adults; Jublia for onychomycosis of the toenails; Xenazine for chorea; Targretin for Cutaneous T-Cell Lymphoma; Arestin, a subgingival sustained-release antibiotic; and PROVENGE for the treatment of prostate cancer..



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