Drugmaker Hikma drops on slashing generics unit forecasts

·1-min read

(Reuters) - Hikma Pharmaceuticals Plc cut annual sales and margin forecasts for its second-biggest unit on Thursday, due to possible delays in the launch of a generic version of a sleep disorder treatment, sending its shares tumbling about 10%.

The London-listed drugmaker now expects revenue from its generics unit to be between $710 million and $750 million for 2022, with core operating margin of around 20%.

The revised outlook comes in stark contrast to the company's trading statement last week, when it had forecasted revenue from the business to grow 8% to 10% over 2021 sales of $820 million and predicted core operating margin in the range of 24% to 25%.

FTSE 100-listed shares of Hikma, which supplies many generic drugs including pain medications, anaesthetics and sedatives, were down 9.6% at 1,667.5 pence by 0739 GMT and were the biggest loser on the UK blue-chip index.

Hikma cited the outlook change to U.S.-based Jazz Pharmaceuticals on Wednesday saying it expects launch of authorized copycats of Xyrem, a treatment for narcolepsy, to happen in late 2022, or possibly even in January 2023.

Under a 2017 agreement with Jazz, Hikma had a set launch date of Jan. 1, 2023 for its generic version of Xyrem, or possibly earlier, depending on market conditions. Hikma was hoping for a launch in mid-2022.

Peel Hunt analysts in a note said although the forecast cut "is obviously disappointing, it is merely phasing (of revenue)".

(Reporting by Pushkala Aripaka in Bengaluru; Editing by Rashmi Aich)