This morning, Forest Laboratories, Inc. (FRX), reported earnings per share of 85 cents for the second quarter of fiscal 2010, in-line with the Zacks Consensus Estimate. Product sales increased 4% to $962.7 million. Although Lexapro sales declined 3.1% to $566 million, Namenda, which is approved for the treatment of moderate and severe Alzheimer’s disease, delivered sales of $275.3 million, recording a growth of 11.9% from the year-ago period. Improved patient access and increased promotional efforts should help keep Namenda sales strong. Bystolic, Forest’s beta-blocker for the treatment of hypertension, posted sales of $40.7 million. This was significantly higher than the year ago sales of $14.2 million. Contract revenue, consisting primarily of Benicar co-promotion income, increased 7.2% to $50.6 million. Forest’s most recent product launch, Savella, which is approved for the management of fibromyalgia, posted sales of $10.2 million. The product, which has been developed in ...

Today, Dainippon Sumitomo and Sepracor (SEPR) have announced the successful completion of the initial share offering period, where almost 78.2% of Sepracor’s shares were tendered. The offer period has been extended to Oct 19, 2009, to enable other shareholders to tender their shares as well.  As a reminder, in September, the Japanese pharmaceutical company Dainippon Sumitomo Pharma Co had announced a deal to acquire Sepracor at $23 per share or $2.6 billion. However, soon after the announcement, shareholders of Sepracor filed a suit in a Delaware court against the company, citing the offered price as inadequate. They were seeking the court’s intervention to stop the deal and pay damages.  Additionally, certain aspects of the deal were against the interest of Sepracor’s shareholders. The deal included a $77.4 million termination fee and a “no solicitation" provision. Apart from restricting the possibility of any superior proposal, these provisions ...

Today morning, Japanese pharmaceutical company Dainippon Sumitomo Pharma Co., Ltd. confirmed that it signed a definitive agreement to buy U.S. pharmaceutical company Sepracor Inc. (SEPR). The deal has been valued at $23 per share or $2.6 billion.

The market was abuzz with rumors yesterday regarding the potential takeover. The rumors led to a 26.46% increase in Sepracor’s stock price. Trading was halted in the afternoon with Sepracor shares closing at $22.80.

This acquisition is the latest in a series of deals conducted by Japanese companies that are looking to tap the U.S. pharmaceutical market – the biggest in the world. Last year, we saw four such deals take place including Eisai’s acquisition of MGI Pharma, Takeda’s acquisition of Millennium Pharma and Shionogi’s acquisition of Sciele. Finally, Daiichi-Sankyo acquired a stake in India’s Ranbaxy Labs.

Following the completion of the acquisition, Sepracor will become a wholly owned subsidiary of Dainippon Sumitomo Pharma America

...

Cornerstone Therapeutics, Inc., a specialty pharmaceutical company, focuses on the acquisition, development, and commercialization of prescription products for the respiratory market in the United States. The company is dedicated to making quality medicines in order to improve the quality of life.

Cornerstone offers trusted medications such as Zyflo CR®, Spectracef® and AlleRx®. Zyflo CR® is an extended release oral medication that is used to prevent and treat asthma in adults and children 12 years and older. Infections caused by bacteria can be treated with Spectracef®, while those suffering from allergies will find relief by taking AlleRx®.

Cornerstone has successfully alienated themselves from their competitors by partnering with leading domestic and international pharmaceutical companies. Through strategic planning, the company aims to maximize the potential value and competitive position of its currently marketed products, newly acquired products and product candidates that are currently in development.

Let us hear your

...

On a stand-alone basis we expect Schering-Plough's (SGP) sales to fall 2% in 2009 due to a significant foreign exchange headwind. Increased competition to prescription Claritin/Clarinex and consumers shifting discretionary spending away from Animal Health and Consumer products will also impact sales growth.We expect EPS to fall 1% in 2009, a more moderate drop than revenues as operating margins benefit from foreign exchange. Gross margins and SG&A and R&D expenses showed a significant benefit from foreign exchange in the first quarter, helping push up EPS 5% on a revenue decline of 6%.While we do not expect the same degree of benefit in the remainder of the year, we believe foreign exchange will help widen operating margins by about 250 basis points in 2009 versus 2008 levels. Operating margins will also benefit from cost-containment from the PTI program.The proposed merger with ...

For Immediate Release

Chicago, IL - June 16, 2009 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Community Health Systems Inc. (CYH), Universal Health Services Inc. (UHS), Merck & Co., Inc. (MRK), Schering-Plough (SGP) and Johnson & Johnson (JNJ).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Monday's Analyst Blog:

Cuts in Healthcare Spending

The actual breakdown of the $313 billion proposed cuts includes: $110 billion in productivity adjustments to Medicare payment updates; $106 billion in reduced hospital subsidies for treating the uninsured as coverage increases; $75 billion from Medicare

...

Based on our earnings model, we expect Merck & Co., Inc. (MRK) to post flat EPS growth from 2008 - 2013 due to the combination of patent expirations of key drugs, recent pipeline failures and softening sales of Gardasil and Singulair.The proposed merger with Schering-Plough (SGP) is clearly an attempt to address Merck's slowing sales and EPS growth. Schering-Plough has relatively little exposure to patent cliffs through 2013 and possesses one of the strongest late-stage pipelines in big-pharma.The deal will add immediate synergies relative to the Vytorin/Zetia joint venture and should offer little overlap in currently marketed products and pipeline compounds. Given the minimal product overlap and relative ease in combining the cholesterol business, we would expect the combination to provide significant synergistic opportunities with combining sales, marketing, research and other back-office functions.The merger is expected to be slightly accretive to ...

Highlights include Merck & Co. (MRK), Schering-Plough Corp. (SGP) and Johnson & Johnson (JNJ).Based on our earnings model, Merck & Co's (MRK) 5-year (2008 - 2013) EPS CAGR [compound annual growth rate] on a stand-alone basis is 2% -- well below the average 6% we see the entire pharmaceutical industry growing over the same period -- due to the combination of patent expirations of key drugs, recent pipeline failures and softening sales of Gardasil and Singulair.The proposed merger with Schering-Plough (SGP) is clearly an attempt to address Merck's slowing sales and EPS growth. Schering has relatively little exposure to patent cliffs through 2013 and possesses one of the strongest late-stage pipelines in big-pharma.The deal will add immediate synergies relative to the Vytorin/Zetia joint venture and should offer little overlap in currently marketed products and pipeline compounds. Given the ...

Highlights include Schering-Plough Corp. (SGP), Merck & Co. (MRK) and Johnson & Johnson (JNJ).Schering-Plough/Merck & Co. Merger Makes SenseOn a stand-alone basis, we expect Schering-Plough's (SGP) sales to increase only 2% in 2009 as increased competition to prescription Claritin/Clarinex comes online and consumers shift discretionary spending away from Animal Health and Consumer products. We expect EPS to fall 5.2% in 2009 to $1.68 as gross margins contract from 2008 levels as a result of a reduced benefit from foreign exchange. SG&A expenses should remain in check as additional benefits are reaped from the PTI program.The proposed merger with Merck & Co. (MRK) is currently expected to close in the fourth quarter. However, we believe Johnson & Johnson (JNJ) will raise some form of challenge relative to rights to Remicade and golimumab, which could potentially delay consummation of ...

Merck and Shering-Plough Announce Merger AgreementThis morning Merck & Co. (MRK) announced plans to purchase Schering-Plough Corp. (SGP) for about $41.1 billion. The proposed purchase price equates to about $23.61 per Schering-Plough share, a 34% premium over Friday's closing price.The deal, which is being called a reverse-merger (as Schering-Plough will be the surviving entity), will be paid for with a combination of cash and stock. Schering-Plough shareholders will receive 0.5767 Merck shares and $10.50 for each Schering-Plough common share. Merck expects to fund the cash portion with $9.8 billion cash-on-hand and $8.5 billion in short-term financing ($3 billion 364-day bridge loan and $5.5 billion in revolving debt). The deal is expected to close in the 4th quarter of this year.The companies expect the deal to produce $3.5 billion in annual cost savings and to be slightly accretive to non-GAAP EPS in ...