BMO Capital analyst Gary Nachman kept his Outperform rating and $37 price target on Mallinckrodt (MNK), saying the FDA’s approval of Praxair (PX) ANDA for Noxivent, which is a generic form of gas used in the Inomax device for “treating neonates with respiratory failure”, has some mitigating factors. The analyst notes that Praxair’s device will still have to be approved by the FDA and litigation appeal between the two companies regarding Inomax patents is still ongoing until the first half of next year, with the possibility of a favorable settlement between the two still possible. Moreover, Nachman points to Mallinckrodt’s “very strong relationships” with partner hospitals’ NICUs, as 25% of its U.S. book of business has been committed for the next couple of years.
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