Shares in Hikma Pharmaceuticals (LON:HIK) have posted a hefty fall this morning as the blue-chip group trimmed its revenue forecasts for the current year. The move came after the company disclosed earlier this month that it was facing a delay in the approval of its generic version of GlaxoSmithKline’s (LON:GSK) respiratory drug Advair.
As of 10:16 BST, Hikma’s share price had lost 4.44 percent to 1,624.50p, underperforming the broader London market, with the benchmark FTSE 100 index having climbed into positive territory and currently standing 0.56 percent higher at 7,477.96 points. The group’s shares have lost more than 27 percent of their value over the past year, and are down by some 14 percent in the year-to-date.
Hikma updated investors on its recent trading this morning, saying that it expects its full-year revenue to come in between $2 billion and $2.1 billion in constant currency, marking a drop from a previous forecast of $2.2 billion. The blue-chip drugmaker explained that the lower guidance reflected changes in the outlook of its generics business “where we have revised our expectation for the launch timing of our generic version of Advair Diskus and where we are experiencing increased price erosion on our marketed products”.
The update came after Hikma recently disclosed that it had received a complete response letter from the US Food and Drug Administration, delaying the approval of its generic version of GSK’s respiratory drug Advair. The company noted today that it was in the process of reviewing the response.
Despite today’s update, Cantor Fitzgerald still sees Hikma as a ‘buy,’ noting that the company was ‘more than just an Advair generic’.
“We note continued strong performance from the sterile injectables business and seasonality within the branded business,” the analysts said, as quoted by Proactive Investors, adding that the availability of a generic Advair was probably still a question of ‘when and not if’.