Endo Q1 Earnings Preview

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ENDP CEO Paul Campanelli

Endo International (ENDP) reports quarterly earnings May 9th. Analysts expect revenue of $691.82 million and eps of $0.43. The revenue estimate implies a 1% decline Y/Y. In Q4 2018 the company shot the lights out. It delivered a revenue beat of nearly $48 million and continued to transition away from pain-related drugs and generics to drugs with much higher margins:

We articulated a clear vision in which we aspire to be a highly focused generics and specialty branded company, delivering quality medicines to patients in need through excellence in development, manufacturing and commercialization. We also told you that this represented a multi-year turnaround plan …

We transformed our legacy US branded pharmaceutical business, focused on pain into a highly focused US branded specialty pharmaceutical business with best in class commercial capabilities. We divested non-core assets and businesses and we repositioned our US generics business by executing a comprehensive product portfolio and manufacturing footprint rationalization initiative.

The plan appears to be working. Revenue of $786 million was up 2% Y/Y, outpacing generic competitors like Mylan (MYL) and Teva (TEVA) who experienced revenue declines.

Revenue from Generics fell by double-digits Y/Y; it remains the company’s largest operating segment at over 30% of total revenue. However, Endo has slowly weaned itself of its dependence on Generics as pricing pressure in North America continues to stymie the segment. Read more:

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