UPDATE 2-King Pharma profit below view; stock plunges

(Updates with details, analyst comment, opening share price)

NEW YORK, Aug 7 (Reuters) - King Pharmaceuticals Inc (KG.N) posted lower-than-expected second-quarter earnings on Thursday as generic competition eroded sales of its Altace blood pressure drug, sending its shares down more than 16 percent.

Net income fell to $43 million, or 18 cents per share, from $64.8 million, or 26 cents per share, a year earlier.

Excluding special items, earnings were 30 cents per share, 2 cents below the analysts' average forecast, according to Reuters Estimates.

"This is the second consecutive disappointing quarter, in our view, and, given how well the stock has traded recently -- on speculation of a takeout that we see as highly unlikely -- we would expect the stock to be appropriately weak today," Natixis Bleichroeder analyst Corey Davis wrote in a research note.

At Wednesday's close, King shares had risen 32 percent since the end of March, compared with a decline of roughly 3 percent in the S&P 500 index .SPX.

The company's second-quarter revenue dropped 27 percent to $396.9 million, as sales of Altace sales plunged 73 percent to $44 million.

King, which makes generic and branded pharmaceuticals, said revenue from branded pharmaceuticals fell to $316 million from $467 million.

Sales of muscle relaxant Skelaxin fell roughly 1 percent to $107 million, while sales of Thrombin, a product to help stop bleeding, slipped to $64 million from $65 million a year earlier.

Sales of hormone replacement therapy Levoxyl fell to $20 million from $26 million.

King shares were down $2, or 16.3 percent, at $10.25 in morning New York Stock Exchange trade. (Reporting by Lewis Krauskopf; editing by John Wallace and Lisa Von Ahn)