Moody's may lower MedPointe

Moody's Investors Service said it placed the ratings of MedPointe Inc. under review for possible downgrade, prompted by the recent termination of MedPointe's marketing and distribution agreement with AstraZeneca for Zomig, a migraine treatment.

Ratings placed under review for possible downgrade include MedPointe's B1 senior implied rating, B1 rating for its $190 million senior secured credit facility, and B2 issuer rating (non-guaranteed exposure).

Moody's believes that this development will reduce MedPointe's top line revenue by about one-half and increase its concentration risk in the allergy product Astelin, now representing the majority of the revenue base. In addition, the loss of Zomig may result in additional product acquisitions in order to leverage MedPointe's sales force.

Other factors contributing to the ratings review include the continuing volatility and deficit in MedPointe's free cash flow, and the impact on cash flow of inventory reductions at drug wholesalers, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.