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Allergan Lowers Outlook, Identifies Growth Markets

Allergan PLC’s Irvine-based eye care and aesthetics and dermatology businesses continue their streak of being top earners despite the company lowering overall earnings expectations for this year to mid-single-digits.

The company looks to expand product offerings in the two key areas and offer greater returns to shareholders, said Chief Executive Brent Saunders at the Goldman Sachs Healthcare CEOs Unscripted Conference on Jan. 5 in Boston.

Dublin, Ireland-chartered Allergan operates primarily out of its U.S. offices in Parsippany, N.J. and Irvine.

Saunders identified three key launches in the eye care business: Restasis Multidose and Oculeve Intranasal Tear Neurostimulator – an eye drop and a handheld device, respectively, that target chronic dry eyes by increasing the eyes’ natural ability to produce tears—and the Xen Gel Stent—an implant that reduces eye pressure for patients with open-angle glaucoma. Restasis is an existing product.

Allergan also acquired Acelity L.P. Inc.’s LifeCell Corp. in December for $2.9 billion. LifeCell makes regenerative tissue products commonly used in breast reconstruction procedures and complex hernia surgeries. The acquisition, which will support Allergan’s portfolio of aesthetic medicine, is projected to provide immediate cash flow of approximately $450 million once the deal closes in the first half of the year.

Saunders said company growth will come primarily from key products in eye care and aesthetic medicine, businesses are based in Irvine.

Allergan’s research and development portfolio has over 70 programs, approximately 72% of them comprising eye care and aesthetics and dermatology, according to company data.

“Growth in 2017, without significant M&A will be powered by new product launches, international growth and growth from key products,” Saunders said, pointing out Europe and China as promising international growth markets.

Allergan, while looking to strong revenue from its Irvine-based businesses, anticipates depreciated sales of Namenda, a drug that treats moderate to severe dementia associated with Alzheimer’s disease, due to the upcoming launch of a generic Namenda XR in the fourth quarter of this year.

Allergan is slated to report its fourth-quarter and full-year 2016 earnings report in February.

On to Canada

Irvine-based Axonics Modulation Technologies Inc. received marketing approval from Canadian regulators, adding a new market following receipt of European CE mark last summer.

It makes implantable sacral neuromodulation devices to treat urinary and fecal dysfunction. Neuromodulation alternates nerve activity by delivering electric stimulation to a target area for therapeutic use. Axonics’ devices are smaller than current sacral neuromodulation devices and are rechargeable, according to Chief Executive Raymond Cohen.

Current sacral neuromodulation devices aren’t rechargeable and require neurostimulator replacement every three to six years, according to a joint study by the University of California-Riverside, Vanderbilt University in Nashville, Tennessee, the Cleveland Clinic in Cleveland, Ohio, Wing Tech Inc. in Menlo Park, and the University of Washington in Seattle.

“Canada is not a big market for our technology; [it is] only about 10% of the U.S. market. But it is a first world market and a new territory [for us],” Cohen said.

The company wants to secure investigational device exemption from the Food and Drug Administration in the next six months in order to start clinical trials.

The company, which has no revenue to date, completed a $38.5 million Series B financing in December. Investors included Paris-based Edmond de Rothschild Investment Partners; NeoMed Management AS in Geneva; Beijing-based Legend Capital, the venture capital arm of Legend Holdings Ltd.; Valencia, Calif.-based The Alfred E. Mann Foundation; Advent Life Sciences in London; Cormorant Asset Management in Boston; and a group of private individuals.

More in Colorado

Irvine-based ChromaDex Corp. opened a 10,000-square-foot research and development center in Longmont Colo., adding to its Boulder, Colo. laboratory.

ChromaDex, which also owns ChromaDex Analytics Inc. and Spherix Consulting, develops and acquires ingredients intellectual property for use in dietary supplements, foods and beverages, skin care, sports nutrition and drugs.

The company’s market cap is about $136.2 million. It grossed approximately $2 million in the quarter ending on Oct. 1, according to its earnings report.

Bits & Pieces

San Clemente-based ICU Medical Inc. adjusted the purchase price of New York-based Pfizer Inc.’s infusion therapy division from $1 billion in cash and stock to no more than $900 million. ICU Medical is a device maker that specializes in infusion therapy, including pumps, tubes and catheters. … Orange County-based companies that were slated to present at the J.P. Morgan Healthcare Conference held Jan. 9 to 12 at the Westin St. Francis Hotel in San Francisco included Edwards Lifesciences Corp., Masimo Corp., ICU Medical Inc., Allergan, and Medtronic PLC. … The women’s hospital at Laguna Hills-based Saddleback Memorial Medical Center was recognized by the California Department of Health Services and Smart Care California for achieving the U.S. Department of Health and Human Services Healthy People 2020 goals of lowering C-section rates. Its 2015 rate was 23.2%, within the Healthy People target of 23.9%.

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