Elite Pharmaceuticals Inc (ELTP)

[no2koolaid]

It depends on what growth means...

LCI has more than Elite's large market IR & XR, it has its own version of Concerta. So, not exactly apples to apples. But even that fails to grasp the reality...if LCI says that not as many scripts are being written one can extrapolate that would mean the increases are not as large as they might have been absent the pandemic. So, Elite's drugs likely were undersold based on projections. In fact, if one takes the time to look at Elite's revenues over the past two Q's, you would find the size of manufacturing suggests a larger than realized commercialization revenue (such proportional relationships are informative).

It is a truism across the range of product markets that those products with larger market shares are often more negatively impacted, the pandemic constricting what might have been even higher growth. When considering CNS drugs and the school closing issues combined with fewer doctor visits - all facts - there is little doubt that Elite's IR & XR were likely limited in their growth. What I expect to see with Q4 is an increase over the previous Q3 that is reflective of the economy opening up and people, having been vaccinated, getting out. Normalization will mean more scripts. However, I would not expect a significantly larger impact until Q2 2022 is reported in November.