Needham & Company Maintains a 'Hold' on Watson Pharmaceuticals (WPI); Lidoderm Settlement A Mild Plus

Needham & Company maintains a 'Hold' on Watson Pharmaceuticals (NYSE: WPI).

Analyst, Elliot Wilbur, said, "Watson and Endo (Nasdaq: ENDP)(Hold) have at last announced a definitive settlement agreement related to WPI’s first-to-file generic version of Endo flagship product Lidoderm, a $900.0MM transdermal formulation expected to see limited generic competition. On balance, we conclude the deal is at least a modest positive for Watson with even a better overall grade if WPI secures approval sometime before Sep. 2013. Deal eliminates best case, from at least a timing perspective, of launch in June 2012 which assumes favorable patent litigation outcome and final FDA approval, the latter of which will likely prove to be the longer-lasting roadblock. In terms of downside of the deal, the one fault we find with the terms is that it does not provide WPI with any product supply should the company not eventually be able to secure its own generic Lidoderm approval."

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

Shares of Watson Pharmaceuticals closed at $73.70 yesterday.

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