UPDATE 1-Teva might sell generic Lipitor this year- analysts

Mon Nov 7, 2011 10:36am EST

By Tova Cohen

TEL AVIV Nov 7 (Reuters) - Teva Pharmaceutical Industries , the world's biggest generic drugmaker, could be gearing up to sell its version of blockbuster cholesterol-lowering drug Lipitor when patent protection expires on Nov. 30, analysts say.

If Teva secures regulatory approval to sell a generic version of Pfizer's Lipitor this year, just one month of sales could add 10 cents to earnings per share in 2011.

The analysts based their assumption on comments made by Teva President and CEO Shlomo Yanai during a conference call last week following publication of third-quarter financial results.

During the call, Israel-based Teva forecast 2011 sales of $18.3-$18.6 billion and earnings per share of $4.92-$5.02, saying the range reflects uncertainty about the timing of the regulatory approval and launch in the United States of an important undisclosed generic product.

"In the event that the company is unable to secure regulatory approval and launch this product in the fourth quarter it would expect to achieve the low end of the full year 2011 outlook," Teva said.

Some analysts said the mystery drug is likely to be a generic version of Pfizer's biggest selling product, the $10-billion a year Lipitor.

Lipitor's patent protection expires Nov. 30, after which two new versions of the drug are expected to be sold by Ranbaxy Laboratories and Watson Pharmaceuticals . They were expected to be the only competitors for six months, after which a number of other copycats may enter the market.

Ranbaxy's scheduled launch of the drug has been clouded by speculation that regulatory troubles could derail its plans.

"We continue to believe that Teva will become a partner for generic Lipitor," said Brad Gastwirth, co-founder of ABR Investment Strategy, a research firm focused on technology, media, telecom and healthcare.

"We continue to hear significant manufacturing issues at Ranbaxy, India's largest pharma company, and we think a Ranbaxy/Teva partnership is likely."

Teva officials did not respond to email and phone requests for comment. Ranbaxy declined to comment.

Sanford Bernstein analyst Aaron Gal also said the drug Teva was referring to was ostensibly Lipitor, saying: "What other product can give Teva 10 cents EPS or $89 million net income in one month."

Gal had earlier believed Teva was likely to act as a supplier to Pfizer rather than forge a deal with Ranbaxy. But he said on Monday contacts in Israel had suggested Teva might act as a supplier to Ranbaxy.

"We are thus modifying our view -- we expect Teva will participate as a supplier in the market, assuming Ranbaxy is approved," Gal said in a note to clients. "However, we are uncertain to which side it will supply the product."

Asked about the partnership speculation, Pfizer would only say that the terms of its 2009 settlement with Teva regarding Lipitor are confidential.

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