Momenta Pharmaceuticals, Inc.
Outperform: $23.00
Model Update: NVS Reports Robust M-Enoxaparin 2Q11 Sales
On 7/19, MNTA's partner Novartis reported strong 2Q M-enoxaparin sales of $284M, above 1Q11 sales of $247M. We now estimate 2Q M-enoxaparin revenues to MNTA of ~$86M. We believe today's result confirms that Sandoz/MNTA continue to maximize production efficiency beyond MNTA's prior expectations. We note it has been about 6 months since the FDA minor deficiency letter for TEVA's generic enoxaparin. As additional time passes, we believe approval of TEVA's generic becomes more questionable. However, we continue to conservatively model entry of TEVA's generic in 3Q11. At current levels, we believe MNTA does not fully reflect the value of M-enoxaparin, M356 and MNTA's technology platform. We are adjusting our price target to $23 from $22 on improved M-enoxaparin cash flow.
.
View Document
Key changes to our model. Based on 1Q profit share margins, we are increasing our 2Q M-enoxaparin sales estimate to $86M from $75M. We model the entry of TEVA's generic enoxaparin in 3Q. However, we have raised our 3Q M-enoxaparin sales estimate to $32M from $13M, given the lack of additional generic competition in July.
