Allergan (NYSE:AGN) had a busy, and occasionally fraught, 2017.
After the company inked a controversial deal with a Native American tribe to shield its Restasis patents from review, a federal judge in Texas invalidated the IP, helping to clear the way for generics. And just last week, Allergan announced that it would slash 1,400 jobs in an effort to cut costs.
But looking ahead to the new year, chairman and chief executive Brent Saunders seems optimistic.
“While we face loss of exclusivity revenue headwinds in 2018, Allergan is in a solid position to unlock value in the near- and long-term,” he said in prepared remarks. “Our confidence is driven by the durable growth prospects for our businesses, the efforts we are taking to right-size the organization, our therapeutic area leadership, deep and high-potential pipeline and strong cash flows and balance sheet.”
The company expects to take a $125 million hit linked to the job cuts, which will be noted in the fourth quarter of 2017.
Allergan said it doesn’t think it will see a generic version of Restasis before the second quarter of this year. But its dry-eye disease drug is not the only product that’s dealing with the threat of competition. A generic for Allergan’s Estrace is already on the market and the company also expects to see a generic cleared in the early part of the first quarter for its Namenda XR product.
Despite the incoming competition, Allergan anticipates posting $15.0 – $15.3 billion in total net revenue for the full-year of 2018. The company is slated to give additional details in regards to its financial outlook as part of its fourth quarter and FY2017 earnings report on Feb. 6.
In its preliminary report, the company also referenced the Tax Cut and Jobs Act that was recently passed into law by President Donald Trump. Allergan said it expects the future impact of the law to be “broadly neutral” to the company’s non-GAAP effective tax rate over time, “with a moderate increase for 2018 as compared to full year 2017.”
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