12:04 PM EDT, 04/23/2024 (MT Newswires) -- Bausch Health ( BHC ) is in a "stronger position" to proceed with a Bausch + Lomb (BLCO) distribution to its shareholders following a recent appellate court ruling that prevents the Food and Drug Administration from approving a generic version of Bausch's diarrhea treatment Xifaxan until 2029, RBC Capital Markets said in a Tuesday note.

Bausch Health ( BHC ) is set to report Q1 results on May 2 and RBC said it will "look for any commentary related to a potential BLCO distribution to BHC shareholders and/or updates to factors that could influence the BLCO distribution."

As for Q1 projections, the investment firm said its revised estimates to reflect data on prescriptions and foreign exchange movements. Q1 revenue is seen at $2.13 billion vs a consensus of $2.15 billion, the firm said, adding that forex may potentially represent a net tailwind based on the company's geographical mix. RBC also noted a 3% year-over-year increase in Xifaxan's total prescriptions in Q1.

RBC maintained a sector perform rating on Bausch Health ( BHC ) and reduced the price target to $11 from $12.

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