Becton, Dickinson and Company (BDX) received an order from the Biomedical Advanced Research and Development Authority (BARDA) of the U.S. Department of Health and Human Services (HHS) for the purchase of syringes and needles, sharps collectors and alcohol swabs for use in national flu pandemic preparedness efforts. The order, worth approximately $52 million, is effective through March 2010.
The new contract is part of the company’s effort to protect Americans from the H1N1 influenza virus, commonly known as “swine flu.” Becton is also in constant touch with governments and vaccine companies across the globe to meet their needs during the flu season.
We think that the new contract will boost Becton’s top-line. This will also add to the company’s contribution to social welfare. Becton, Dickinson and Co. develops, manufactures and markets medical devices, supplies, laboratory equipment and diagnostic products globally. The company is a world leader in safety needle products.
Becton competes with players like Baxter International (BAX), Johnson & Johnson (JNJ) and Abbott Laboratories (ABT), all of which have large resources.
However, we believe that the company’s sound business model and product line should weather the current economic turbulence, and is capable of withstanding competitive pressure. Based on the company’s performance in the third quarter of fiscal 2009, we have a Neutral recommendation on Becton stock.
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