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The Medicines Co. Posts Disappointing Preliminary Results - Analyst Blog

Zacks Equity Research
Updated

The Medicines Company MDCO announced disappointing preliminary worldwide net revenues for the first quarter of 2015. The company expects worldwide net revenues in the first quarter of 2015 to be in the range of $125 million to $130 million.

Revenues in the first quarter are expected to decline 26–29% from $177.2 million reported a year ago. Expected revenues are also below the current Zacks Consensus Estimate of $190 million.

The decrease in worldwide net revenue is primarily due to lower sales of Angiomax (EU trade name: Angiox). The company expects Angiomax revenues to be in the range of $97 million to $105 million compared with $155.7 million in the first quarter of 2014.  The company attributes the likely decline in Angiomax sales to customers’ current uncertainly regarding the product’s patent exclusivity in the U.S. after Jun 2015

We remind investors that The Medicines Company is facing patent challenges for Angiomax from several companies including Hospira Inc. HSP and Mylan MYL. The company is entangled in patent infringement lawsuits with both Hospira and Mylan; an unfavorable ruling by the court could result in the entry of generic Angiomax as early as Jun 15, 2015.

Angiomax is approved for use in unstable angina patients undergoing percutaneous transluminal coronary angioplasty or percutaneous coronary intervention including patients with or at risk of heparin induced thrombocytopenia and thrombosis syndrome. The product accounted for almost 88% of the company’s total revenues in 2014. Earlier-than-expected entry of generics will be a major setback for the company.

The company is set to release its final results for the first quarter of 2015 on May 5, 2015.

The Medicines Company carries a Zacks Rank #3 (Hold). A better-ranked stock in the health care sector is Cytokinetics, Incorporated CYTK sporting a Zacks Rank #1 (Strong Buy).


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Zacks Investment Research