Mylan (MYL) has managed to grow itself into a competitive generic drug provider through a slew of acquisitions. Analysts now see it positioned to benefit from those recent M&A moves.
Mylan is a fully integrated global pharmaceutical company that develops, licenses, manufactures, markets and distributes generic, branded generic and specialty pharmaceuticals.
Mylan provides products to customers in approximately 150 countries and territories. Its product portfolios are supported by a robust product pipeline and one of the world’s largest vertically integrated active pharmaceutical ingredient (API) operations, management said in a recent filing. Additionally, MYL operates a specialty business which is focused on respiratory, allergy and psychiatric therapies.
“Our leadership position in the U.S. generic pharmaceutical industry is the result of our ability to obtain Abbreviated New Drug Application (ANDA) approvals, as well as our reliable and high quality supply chain,” management reported.
Through acquisitions “we have created a horizontally and vertically integrated platform with global scale, augmented our diversified product portfolio and further expanded our range of capabilities, all of which we believe position us well for the future.”
Mylan has a market cap of $9.59 billion in a sector, pharmaceuticals, where the average company size is $23.72 billion. Its trailing 12-month P/E ratio is 18.32 and its five-year projected price-to-earnings-growth (PEG) ratio is 1.75, compared to 3.33 for the sector.
Its projected earnings per share growth for the coming year is 9.6 percent, compared to a sector average of 6.32 percent.
Robust growth
Analysts are positive on MYL, with buy or outperform calls from Lehman Brothers, Smith Barney, Standard & Poor’s Equity Research, and Morgan Stanley.
“We believe MYL's efforts to expand through acquisitions and internal growth has led to its present status as the world's third-largest generics and specialty pharmaceutical company. Key acquisitions made in recent years include Bioniche Pharma, an Ireland-based maker of injectable drugs; Matrix Laboratories, a leading producer of active pharmaceutical ingredients; and Merck KGaA's generic business,” S&P analysts wrote in mid-August.
“The latter has especially broadened Mylan's geographic reach and provided access to in-house raw materials and generic biologics. We see MYL as uniquely positioned to benefit from the robust growth that we forecast for the overall global generics market.”
Mylan next reports on Oct. 25.
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