S&P: Arbor Pharmaceuticals to negative

S&P said it affirmed the BB- long-term corporate credit rating on Arbor Pharmaceuticals Inc. and revised the outlook to negative from stable.

In addition, the agency affirmed the BB rating on Arbor's senior secured debt. The recovery rating is 2, indicating expectations for substantial (70%-90%; rounded estimate: 70%) recovery in the event of a payment default.

S&P said the negative outlook reflects its view that uncertainty of Arbor's credit risk has increased following earlier-than-expected competition to its antibiotic assets, major regulatory setbacks in its generic business, and higher-than-expected pricing pressure, which caused the company to significantly miss our expectations for 2017.

The agency believes Arbor used most of its cushion at the current rating, and an additional operational set back or continued pricing pressure could lead S&P to determine its credit risk is not comparable to other BB- issuers.

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