Watson Pharmaceuticals, Inc. (NYSE: WPI) today provided a detailed overview of its expanded global operations, enhanced supply chain capabilities and commercial and pipeline developments in its Brand and Generics businesses during an Investor Day meeting held in New York, NY. In conjunction with the meeting, the company is providing its 2010 financial forecast.
Watson management predicted continued growth in its Generics, Brand and Distribution businesses, with 2010 revenues expected to be approximately $3.5 billion and double-digit annual cash earnings per share growth projected for 2010-2012.
"We have been building the strategic foundation over the past two years that will serve as the platform for Watson's continued growth and expansion. While there is more to accomplish, we continue to grow the Company and are pleased with the results we have achieved to date," said Paul Bisaro, Watson's president and chief executive officer.
"We have strengthened our global supply chain, significantly enhanced our profits and have refocused our generic development pipeline to maximize unique opportunities and drive an enviable first-to-file portfolio. This year, we expanded beyond our core U.S. business with the acquisition of Arrow that delivers a global commercial footprint."
"We have also made substantive progress against our objective to realign our brand business by capitalizing on our legacy strengths in women's health and maximizing our position with OB/Gyns, urologists and other targeted physician groups," Bisaro continued. "We have strengthened our brand pipeline with many near and long-term commercial opportunities, and have taken measurable and sustainable steps into biologics. We are in a strong position to deliver sustainable adjusted EBITDA and cash earnings per share growth in 2010 and beyond by leveraging the strengths of our mixed generics and brand business model."
During the Investor Day meeting, Watson showcased its global management team in a review of the Company's global businesses and operations, provided the first extensive view into the assets provided by the acquisition of the Arrow Group during 2009, and provided investors with business unit-based forecasts for performance.
U.S. Generics Business Complemented by Global Strengths and Significant Growth Opportunities
"Our acquisition of Arrow has enabled us to substantially reshape our generic business. We enter 2010 with a larger product portfolio, an enhanced pipeline of new products; and, access to established and emerging markets where we can benefit from the increase in generic utilization," said Tom Russillo, Executive Vice President, Global Generics. "We have already begun to maximize our new global opportunities for the near-term, while putting in place the strategies that will deliver long-term opportunities. We are investing in the future, to ensure generic growth across all markets in which we now have a position."
During 2009, Watson filed 36 Abbreviated New Drug Applications (ANDAs) with the U.S. Food and Drug Administration (FDA), including a recently filed application for Lidocaine Topical Patch 5%, a generic version of Endo Pharmaceutical's Lidoderm® product.
Watson management noted that its U.S. generic portfolio has increased by approximately 20 products as a result of the Arrow acquisition, with such key products as Ramipril, Isradipine, Ciprofloxacin and Acarbose. Sales and marketing of U.S. generic products was transferred to Watson Sales/Customer Service at the end of 2009, the Arrow marketing operations in Florida have been closed, and transfer to the Watson label is underway. Watson currently markets over 170 generic prescription product families in the U.S.
Watson currently has more than 100 ANDAs on file in the U.S., with 38 potential first-to-file or shared exclusivity products. The Company said that it expects to submit more than 100 product applications worldwide in 2010.
Management provided an overview of the key mature international markets where it has operations, including:
- Canada, where it ranks 8th in the market with 49 products;
- The U.K. where it ranks 5th in the market with 250 products;
- France where it where it ranks 7th in the market with 320 products;
- Australia where the Company markets 19 products.
The Company also noted that it has more than 30 molecules registered in a number of additional European countries.
The company forecast 2010 Generics segment revenues to be approximately $2.3 billion, a record level which includes the addition of $600 million in international revenue.
Brands Poised to Expand Leadership Position in Urology; Substantially Enhance Position in Women's Health
Watson management provided an update of market/payer acceptance of recently launched Brand products, including RAPAFLO® for benign prostatic hyperplasia (BPH) and GELNIQUE® for overactive bladder (OAB), noting a stronger managed care position going into 2010. Management noted that the Company's U.S. sales force has been realigned to extend its reach and effectiveness in the urology, OB/Gyn and targeted primary care markets. The new structure recognizes the division's near- and mid-term opportunities, as it strengthens its position in urology and women's health, including: