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Shares of  Hospira Inc. (HSP - Analyst Report) soared to a 52-week high of $39.48 towards the end of the trading session on Jul 9, 2013 buoyed by the positive opinion issued by the European Medicines Agency’s Committee for Medicinal Products for Human Use (CHMP) regarding the approval of Inflectra (infliximab).

The closing price of this company on that day was $39.44, representing an impressive year-to-date return of 24.1%. Moreover, Perrigo has delivered positive earnings surprises in each of the last four quarters with an average beat of 7.14%. The long-term expected earnings growth rate for this stock is 7.9%.

Favorable CHMP Opinion- A big Positive

Shares of Hospira have been on the upswing ever since the CHMP recommended the approval of Inflectra for the treatment of rheumatoid arthritis, inflammatory bowel disease and plaque psoriasis. We note that Inflectra is the biosimilar version of Johnson & Johnson / Merck & Co. Inc’s (JNJ - Analyst Report)/(MRK - Analyst Report) blockbuster drug Remicade. Hospira noted in its press release that Inflectra is the first monoclonal antibody therapy to receive a favorable opinion from the CHMP after review through the EMA biosimilars regulatory pathway.

Hospira, which currently markets two biosimilars in Europe, boasts of a strong biosimilars pipeline with 11 candidates in development. Biosimilars, which are generic versions of biologic drugs, are expected to be a significant growth driver in the generics industry in the coming years. The biosimilars market represents huge commercial opportunity with a significant amount of biologic sales slated to lose patent protection in the coming years.

A Stock Worth Considering

Hospira carries a Zacks Rank #3 (Hold). One can consider ResMed Inc. (RMD - Analyst Report) a good buying opportunity. This medical stock – sporting a Zacks Rank #2 (Buy) – has performed encouragingly over the last few quarters with potential to rise significantly from current levels.

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