UPDATE 2-Meridian Bioscience cuts FY10 outlook, cites weak Q2

* Sees FY10 sales $145-$153 mln vs prior view $160-$165 mln

* Sees FY10 EPS $0.70-$0.80 vs prior view $0.90-$0.95

* Sees Q2 sales $30-$33 mln, EPS $0.13-$0.15

* Q2 demand for upper respiratory products falls sharply

* Shares down as much as 18 percent
(Adds analyst comment, details, share movement)

By Shailesh Kuber

BANGALORE, March 17 (Reuters) - Diagnostic test kit maker
Meridian Bioscience Inc (VIVO.O: Quote, Profile, Research) lowered its 2010 outlook
citing a weaker-than-expected second quarter, hurt by lower
demand for its upper respiratory and C. difficile products.

"It's even weaker than we expected. We were not fully
expecting it to this extent," CJS Securities analyst Lawrence
Solow said.

Shares of the company fell as much as 18 percent.

Demand for its upper respiratory products declined sharply
during the second quarter as the H1N1 pandemic came to an
abrupt end in early December, resulting in a collapse in order
volumes and a likely overstock situation in many laboratories.

Meridian expects second-quarter earnings between 13 cents
and 15 cents a share, on revenue of between $30 million and $33
million.

For the second quarter, analysts had expected earnings of
22 cents, on revenue of $38.2 million.

For full-year 2010, the company now expects to earn between
70 cents and 80 cents a share, down from its prior view of
between 90 cents and 95 cents a share.

It now expects full-year revenue of between $145 million
and $153 million, down from its prior view of between $160
million and $165 million.

For full-year 2010, analysts on average expected earnings
of 93 cents per share, on revenue of $165.1 million, according
to Thomson Reuters I/B/E/S.

The company also said C. difficile products suffered a
decline in the first half of fiscal 2010 due principally to
increased competition from traditional immunoassay companies
plus emerging new molecular diagnostic methods.

Clostridium difficile, or C. difficile, is a type of
bacteria that can cause diarrhea and other intestinal diseases.

C. difficile products accounted for more than 25 percent of
the company's global diagnostics revenues for fiscal 2009.

Meridian plans to launch its illumi gene molecular C.
difficile product later this fiscal year.

"Molecular testing is more than two times on price and
that's a segment where the company could hopefully reinvigorate
some revenue growth for themselves over the long run," analyst
Solow said.

Shares of Meridian were down 16 percent at $20.04 in late
morning trade. They touched a low of $19.44 earlier in the
session, and were among the top percentage losers on Nasdaq.
(Reporting by Jennifer Robin Raj and Shailesh Kuber in
Bangalore; Editing by Gopakumar Warrier, Jarshad Kakkrakandy)