Bausch Health (BHC, Financial) and Salix Pharmaceuticals have revealed new findings indicating that patients hospitalized for overt hepatic encephalopathy (OHE) experienced a lower risk of rehospitalization related to OHE within 30 days when treated with Xifaxan after discharge. This data, derived from a claims-based analysis, will be shared at Digestive Disease Week 2025 in San Diego, CA.
In individuals with cirrhosis, fully symptomatic OHE is a major complication signifying the decompensated phase, leading to adverse outcomes, increased morbidity, and mortality. Liver damage in cirrhosis allows gut toxins to enter the bloodstream and affect brain function, triggering OHE episodes characterized by cognitive, behavioral, and consciousness changes. Treatment guidelines by the American Association for the Study of Liver Diseases (AASLD) advocate for Xifaxan as an adjunct to lactulose after an OHE episode to prevent recurrences.
The study demonstrated that patients who left the hospital with only lactulose had a higher likelihood of 30-day rehospitalization compared to those administered Xifaxan. This trend persisted across varying levels of care quality and among both Medicare and Medicaid patients. Out of 7,880 analyzed cases, 27.1% of patients received Xifaxan, 24.1% lactulose, and 48.8% had no prior treatment.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 6 analysts, the average target price for Bausch Health Companies Inc (BHC, Financial) is $7.50 with a high estimate of $10.00 and a low estimate of $5.00. The average target implies an upside of 52.13% from the current price of $4.93. More detailed estimate data can be found on the Bausch Health Companies Inc (BHC) Forecast page.
Based on the consensus recommendation from 6 brokerage firms, Bausch Health Companies Inc's (BHC, Financial) average brokerage recommendation is currently 3.2, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Bausch Health Companies Inc (BHC, Financial) in one year is $9.07, suggesting a upside of 83.98% from the current price of $4.93. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Bausch Health Companies Inc (BHC) Summary page.
BHC Key Business Developments
Release Date: April 30, 2025
- Revenue: $2.259 billion, up 5% on a reported basis and 6% on an organic basis year-over-year.
- Adjusted Gross Margin: 69.9%, a decrease of 130 basis points year-over-year.
- Adjusted Operating Expenses: $994 million, an increase of $78 million compared to the previous year.
- Adjusted R&D Expenses: $143 million, a decrease of 5% year-over-year.
- Adjusted EBITDA: $661 million, a decrease of $4 million or 1% year-over-year.
- Adjusted Operating Cash Flow: $110 million.
- Salix Revenue: $542 million, up 9% on a reported basis and 6% on an organic basis year-over-year.
- Xifaxan Growth: 8% year-over-year, with retail scripts growing 1.5% and new script growth at 3%.
- International Segment Revenue: $262 million, down 1% on a reported basis but up 5% on an organic basis year-over-year.
- Solta Medical Revenue: $113 million, up 28% on a reported basis and 33% on an organic basis year-over-year.
- Diversified Segment Revenue: $205 million, up 1% on a reported basis and flat on an organic basis year-over-year.
- Bausch & Lomb Revenue: $1.1 billion, up 3% on a reported basis and 5% on an organic basis year-over-year.
- Net Debt Reduction: Decreased by approximately $85 million in the first quarter.
- Refinancing Transaction: $7.9 billion refinancing completed, extending debt maturities to 2028 and beyond.
- Full-Year 2025 Revenue Guidance: Between $4.950 billion and $5.1 billion.
- Full-Year 2025 Adjusted EBITDA Guidance: Between $2.625 billion and $2.725 billion.
- Full-Year 2025 Adjusted Operating Cash Flow Guidance: Between $825 million and $875 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Bausch Health Companies Inc (BHC, Financial) achieved its eighth consecutive quarter of year-over-year revenue and adjusted EBITDA growth.
- The company successfully completed a $7.9 billion refinancing effort, extending near- and medium-term maturities, providing additional financial flexibility.
- Bausch Health Companies Inc (BHC) received a favorable ruling from the DC District Court in the Norwich case against the FDA.
- The Salix segment showed strong performance with 8% growth in Xifaxan sales, driven by both price and volume increases.
- The Solta Medical segment delivered 33% organic revenue growth, with significant contributions from South Korea and China.
Negative Points
- Adjusted operating cash flow guidance was updated down by $150 million due to higher interest rate expenses from the refinancing transaction.
- Adjusted gross margin decreased by 130 basis points year-over-year.
- The International segment reported a 1% decrease in revenue on a reported basis, impacted by currency fluctuations.
- The company faces potential challenges from evolving tariffs and trade measures, particularly affecting the Solta business in China.
- Despite strong financial performance, Bausch Health Companies Inc (BHC) acknowledges that its stock price does not reflect the company's value, indicating a need to unlock shareholder value.
