Aegis Capital Cuts PT on SciClone (SCLN) to $8; China Restrictions Will Hamper N-T Results

November 12, 2013 2:49 PM EST
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Aegis Capital maintains its Buy rating on SciClone Pharmaceuticals (Nasdaq: SCLN), but moves its price target down from $9 to $8 following Q2 results.

SciClone posted Q3 EPS of $.18 and revs of $35.2 million, while the Street was looking for EPS of $.15 with revs of $39.7 million. Aegis Capital analyst Raghuram Selvaraju noted In 3Q 2013, Chinese government started investigating GlaxoSmithKline (NYSE: GSK) for alleged bribery. Interactions between pharmaceutical sales reps and doctors have since been under close monitoring by government agencies. We believe this market condition could be the reason behind lower-than-expected Zadaxin sales in the third quarter. He sees the condition to continue into Q114.

Selvaraju sees $25 million reduction in annual revenue from the expected discontinuation of its Sanofi (NYSE: SNY) partnership.

Following SciClone's results, Selvaraju lowered expectations. FY13 revs move from $140.1 million down to $132.6 million. FY14 revs and EPS drop from $169.8 million and $.67 down to $150.0 million and $.54. The lower price target stems from the analyst's new FY14 profit expectations.

For an analyst ratings summary and ratings history on SciClone Pharmaceuticals click here. For more ratings news on SciClone Pharmaceuticals click here.

Shares of SciClone Pharmaceuticals closed at $4.47 yesterday, with a 52 week range of $4.13 to $6.30.

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