Mylan Analysts Respond Positively Following EpiPen Classification Settlement

Mylan NV MYL over the weekend announced a $465 million settlement agreement with the Department of Justice over its EpiPen classification. The stock was up more than 11 percent to $40.13 in Monday's pre-market session.

Several Wall Street analysts were quick to weigh in on the issue.

• JPMorgan said the settlement and updated guidance are a positive
• Raymond James upgraded the stock to Strong Buy
• UBS lowered price target from $66 to $60
• Susquehanna lowered price target from $60 to $50

BTIG analyst Timothy Chiang views the agreement as significant, as he expects it to put the Epipen pricing controversy to rest.

FTC Investigation Looms

However, BTIG believes a separate FTC investigation could still move forward, as the size of the agreement reduces the probability for an agreement. The firm also noted that the company suggested in its 8k filing that the SEC has requested documents on its products tied to the Medicaid Drug Rebated Program.

The company reduced its calendar year 2016 earnings per share estimate to $4.70-$4.90 from $4.85-$5.15, citing changes with the Epipen patent access programs and the imminent launch of an authorizes generic, the firm noted.

As such, BTIG lowered its calendar year 2016 earnings per share estimate to $4.70 from $5.05 and that for 2017 to $5.58 from $5.78. The firm attributed the action to reflect the impact of the upcoming launch of an authorized generic version of Epipen.

BTIG lowered its price target on shares of Mylan by $5 to $55 from $60.