Needham & Company Maintains a 'Strong Buy' on Par Pharmaceutical (PRX); Whistleblower Lawsuit Accuses Par of Illegal Drug-Switching Scheme
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Price: $49.98 --0%
Rating Summary:
1 Buy, 8 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
1 Buy, 8 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Needham & Company maintains a 'Strong Buy' on Par Pharmaceutical (NYSE: PRX) price target of $38.00.
Needham analyst says, "A whistleblower lawsuit recently unsealed in federal court revealed that PRX and two foreign companies (both of which are now Mylan (NYSE: MYL) subsidiaries) are accused of engaging in an illegal drug-switching scheme to increase sales by avoiding Medicaid price limits...The market over-reaction on the news headline is not surprising in light of PRX’s recent ~$154MM settlement around drug pricing lawsuits. This type of news flow typically garners little attention given that it has no impact on earnings, it is difficult to gauge the validity of the lawsuit and it takes a long time to reach a resolution. Net-net, PRX could be liable for another settlement but overall operations remain unaffected in the near-term. Though any eventual settlement would obviously diminish overall firm NPV, the timing of the release combined with current market jitters compounded the late day swoon. Given the absence of any P&L impact, we expect shares to quickly recover stemming from the knee jerk reaction and for this risk to quickly fade away."
For more ratings news on Par Pharmaceutical click here and for the rating history of Par Pharmaceutical click here.
Shares of Par Pharmaceutical closed at $27.03 yesterday.
Needham analyst says, "A whistleblower lawsuit recently unsealed in federal court revealed that PRX and two foreign companies (both of which are now Mylan (NYSE: MYL) subsidiaries) are accused of engaging in an illegal drug-switching scheme to increase sales by avoiding Medicaid price limits...The market over-reaction on the news headline is not surprising in light of PRX’s recent ~$154MM settlement around drug pricing lawsuits. This type of news flow typically garners little attention given that it has no impact on earnings, it is difficult to gauge the validity of the lawsuit and it takes a long time to reach a resolution. Net-net, PRX could be liable for another settlement but overall operations remain unaffected in the near-term. Though any eventual settlement would obviously diminish overall firm NPV, the timing of the release combined with current market jitters compounded the late day swoon. Given the absence of any P&L impact, we expect shares to quickly recover stemming from the knee jerk reaction and for this risk to quickly fade away."
For more ratings news on Par Pharmaceutical click here and for the rating history of Par Pharmaceutical click here.
Shares of Par Pharmaceutical closed at $27.03 yesterday.
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