Endo Sales Slippage

The company says it expects a bounceback, though.
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Endo Pharmaceuticals (ENDP) - Get Report warned that sales of its biggest drug would slip in the third quarter.

The Chadds Ford, Pa., pain management drug company said it signed an inventory management agreement during the quarter with one of its three largest wholesale drug distribution customers. Endo said the customer began reducing its inventory levels of its Lidoderm lidocaine patch 5%. Endo said the so-called inventory de-stocking led net sales of Lidoderm "to be below underlying demand" for the quarter ended Sept. 30.

The company said underlying demand for Lidoderm "continues to show strong year-over-year prescription growth in the 20%-plus range, and we estimate the quarterly run rate for Lidoderm to be approximately $145-$150 million. Thus, we continue to expect that, as previously communicated, net sales of Lidoderm for 2006 will be at the high end of our estimated range of $530-$540 million, which had included the impact of inventory de-stocking in anticipation of an IMA."

The company also noted "a somewhat slower than expected uptake of Opana ER (oxymorphone HCl) extended-release and Opana (oxymorphone HCl) immediate-release tablets CII," but said it is "encouraged by the recent upward trend in Opana prescriptions, which indicates to us that our marketing and promotional efforts are beginning to have the desired effect."

Shares fell 44 cents late Monday to $32.69.