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Valeant expects Mylan's launch of generic herpes drug to hurt profit

(Reuters) - Valeant Pharmaceuticals International Inc, Canada's biggest listed drugmaker, said it expects Mylan Inc's launch of a generic version of Valeant's genital herpes drug to reduce its cash earnings-per-share for the year by 30 to 40 cents.

The company said it would launch its own generic of the ointment, Zovirax, on Thursday.

Mylan, a generic drugmaker, said on Wednesday it received final approval for the first generic version of Zovirax from the U.S. Food and Drug Administration.

Valeant had said in January it sees 2013 adjusted profit, which it calls cash earnings per share, of between $5.45 and $5.75.

The company, caught in a bidding war with German drugmaker Merz Pharma Group for cosmetics products maker Obagi Medical Products Inc, has been bulking up its skin care portfolio in the United States.

"While the timing of a generic approval was always uncertain, this was not unforeseen and we were prepared for its eventuality," said Chief Executive Michael Pearson.

However, the company did not factor in the generic launch in its original budget expectations.

The company said there are other actions, such as several product acquisitions, repricing of its term loan debt that could mitigate the impact of Zovirax losing patent protection.

(Reporting by Bhaswati Mukhopadhyay in Bangalore)

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