Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

Lundbeck Delivers Some Data-Driven Upside

Danish specialty pharmaceutical company H Lundbeck A/S (OTCPK:HLUYY) (LUN.CO) is facing down some steep patent cliffs, as about two-thirds of the company's first revenue loses patent protection over the next two and a half years. Management hopes that significant new drugs launched with partners Takeda (OTCPK:TKPYY) and Otsuka (OTCPK:OTSKY) will more than fill the gap, and some recent updates on key drug Brintellix have been positive. Lundbeck is also looking at upside potential from desmoteplase, brexpiprazole, and Northera (which Lundbeck is acquiring in its announced deal for Chelsea Therapeutics (NASDAQ:CHTP)), though these are higher-risk options today. All told, while Lundbeck remains a risky proposition, there is still upside to over $30.


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