Covidien provides sales targets for pharma spinoff

NEW YORK (AP) -- Covidien PLC on Friday provided further details on its business following the planned spinoff of Mallinckrodt, its pharmaceuticals unit.

The Irish company expects to complete the spinoff after the close of trading on June 28. It said revenue from its remaining businesses, which sell medical devices and supplies, will grow by 4 or 5 percent in the current fiscal year. Covidien said revenue for Mallinckrodt is expected to grow between 7 and 11 percent. Those estimates both assume foreign currency exchange rates will hold steady for the rest of the year.

The company's fiscal year ends Sept. 27.

Covidien expects medical device revenue to grow by 4 to 6 percent and medical supply revenue to rise by 1 or 2 percent. That's down slightly from its earlier estimates because of unfavorable changes in currency exchange rates.

The company said revenue from Mallinckrodt's specialty drug business will grow by 21 to 25 percent with medical imaging revenue down by 3 to 7 percent. It is forecasting at least $125 million in sales of generic extended-release Ritalin, and at least $100 million in revenue from chronic pain drug Exalgo.

Mallinckrodt expects to report around $130 million in annual corporate, governance, and international infrastructure costs that had been handled by Covidien. That's an increase of about $40 million from the previous fiscal year. That estimate does not include any one-time costs or potential savings from restructuring or other changes.

Shares of Covidien rose 12 cents to close at $64.35.