) to neutral from buy.
Analyst Steven Valiquette says he's downgrading on revised estimates for the company's generic Duragesic drug for pain. He had thought generic Duragesic would be a key catalyst for Mylan's stock, but an analysis of post-trial briefs leads him to believe that Mylan now has less than a 50/50 chance of winning a patent dispute with Johnson & Johnson.
Valiquette expects the patent ruling to occur in either December or January. He removed $50 million of generic Duragesic revenues from his fiscal 2004 (Mar.) estimate, and cut the $200 million fiscal 2005 generic Duragesic revenue estimate to $40 million.
He also lowered the $1.20 fiscal 2004 earnings per share estimate to $1.16, and trimmed the $1.45 fiscal 2005 estimate to $1.30. Finally, Valiquette cut the $31 target to $24.