OREANDA-NEWS. January 12, 2010. Pharmstandard was unsuccessful in its attempt to win a 10-month government tender for the distribution of Velcade® (Bortezomib), according to Vedomosti. The initial amount of the contract, starting from March 2010, is RUB3.57bn (US119m), reported the press-centre of OTKRITIE Financial Corporation.

View: We see this news neutral for the company's EBITDA and bottom line, as the distribution of Bortezomib is a low margin segment.

Valuation: The stock currently trades on a 2010 EV/EBITDA of 9.6x, which is a 37% discount to EM peers.

Action: This news could negatively impact the stock price, though we see it as neutral for the company's financials. If the market takes this news as negative, we recommend buying on weakness.