By Akankshita Mukhopadhyay
Feb 27 (Reuters) - Endo International Plc's full-year revenue and profit forecasts fell short of Street estimates, due to continued pressure on its generics business and increased competition, sending its shares down nearly 5 percent in on Tuesday.
Endo and other generic drug makers have been coping with low generic drug prices as large U.S. retail pharmacies wield more leverage during purchases, while U.S. regulators are approving more such copycat drugs, further pressuring prices.
Adding to those pressures are the multiple lawsuits that the Ireland-based company is facing related to the opioid epidemic in the United States. Endo had been accused of marketing opioid painkillers and concealing the risks of their use.
The company pulled one such painkiller, Opana ER, from the market last year after U.S. health regulators declared the drug's benefit did not outweigh its risks.
Endo said Tuesday it had increased its legal reserves by about $200 million to resolve various lawsuits, the majority including cases by people who claimed injury after using the company's testosterone replacement medications.
Last week Endo said it settled a lawsuit alleging it paid Allergan Plc's unit, Watson Pharmaceuticals Inc, to delay launching a generic version of Endo's Lidoderm painkiller patch. Terms of the accord have not been disclosed.
Mizuho Securities USA analyst Irina Koffler said that while the $200 million reserve was a "favorable outcome", it was insufficient to offset the impact of the weaker 2018 outlook and the overhang of the opioid-related lawsuits.
Endo expects 2018 revenue of $2.6 billion to $2.8 billion, missing analysts' average estimate of about $3 billion, according to Thomson Reuters I/B/E/S. Its earnings forecast of $2.15 to $2.55 per share also missed estimates of $2.86.
However results in Endo's latest quarter topped expectations due to an increase in sales at its sterile injectables and specialty drugs businesses.
It's net loss narrowed to $368.4 million in the fourth quarter, from $3.34 billion a year earlier, as asset impairment charges fell to $130.5 million from $3.52 billion.
Excluding items, Endo's earnings of 77 cents per share beat analysts' estimate of 61 cents. Revenue slumped 38 percent to $768.6 million, but also beat estimate of $760.1 million.
Sales in Endo's sterile injectables business, which includes blood pressure drug Vasostrict, rose 16 percent, while sales in its specialty drugs business rose 8 percent.
The company's shares were down 4.7 percent at $6.52 in morning trading on the Nasdaq. (Reporting by Akankshita Mukhopadhyay in Bengaluru; Editing by Savio D'Souza and Anil D'Silva)