underperform recommendation, page-9

Agree - i don't mind the 'One Hit Wonder' exposure so long as axiron was taking share (that is where all the value is at this point)- i think the market view has changed from the $4 days - IF axiron could get to 30% US market share by 2017/2018 and then hold it around the 20's going forward (in the face of generics) and IF the market was growing at 15+% pa then yeah - ACR is worth well north $4

But things have changed - what we know :
1- the US transdermal testosterone market has slowed to low single digit growth (from 20%+ pa growth). the reason for this is not 100% clear - it could be temporary or it may not? but must be partly due to competition, testosterone injections etc and is evident through higher than expected rebates.
2 - US axiron market share penetration has slowed - its still gaining share but at a slower rate. This is to be expected, but what is unknown is what the peak will be 20% or something higher
3 - Other unknowns - Lilly has had issues with its salesforce - not sure how much this is impacting the market share issue. Also not 100% how committed Lilly is to this product's success?
4 - How is the international market going - what is the outlook and how fast can they ramp up with Canada, Europe etc.

Now in my opinion these issues may be temporary - very difficult to draw a trend based on 6mths worth of prescription data - but the risk is it may not...

I'm betting it is temporary and we will see the $4 days again as the US market improves and market share gains are locked in... will wait and see. IF this view is correct, i'm not so worried about R&D spend - call it an option - you never know - they may come up with something here worth some extra $$ to shareholders.