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Valeant target cut to $9 from $11 by Mizuho

February 27, 2017

Mizuho Securities lowered its price target on Valeant Pharmaceuticals (NYSE: VRX) to $9.00 (from $11.00) while maintaining a Underperform rating.

Analyst Irina Koffler comments “Lackluster asset base and pipeline also keep us concerned: We note that total milligrams of Xifaxan grew 16.5% in 2016 but this trajectory flattened to approximately 2% Y/Y growth in 4Q:16. We think the brand is slowing and the overall franchise may only sustain low single-digit growth in 2017, making it the most attractive segment within Valeant. Expanding into primary care doctors is not expected to halt this trend. Dermatology is also declining, and management is hoping for a boost from its pipeline that may take several years. We view Siliq for psoriasis as a dilutive asset, similar to Addyi. We are finally seeing signs of growth from Relistor but the product is too small to matter, and it sounds like Valeant may try to sell it.”


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