Alkermes Should Profit From Lilly's Delayed Drug

Baird is out with a good call on Alkermes (NASDAQ:ALKS) after Eli Lilly (LLY) announced that it has received a Not Approvable Letter for Zyprexa Long-Acting Injection [LAI] for the treatment of schizophrenia.

This is very positive for ALKS, as it delays or possibly removes a potential threat to Risperdal Consta. FDA cited concern over the excessive sedation that was seen in approximately 1% of patients in clinical trials, and the agency needs more information to better understand the risk and underlying cause of these events.

Firm notes JNJ submitted an NDA for another potential competitor to Risperdal Consta, paliperidone palmitate, on 10/29/07. Given Invega's poor launch (less than 2% market share after one year), they do not think that paliperidone palmitate is a serious threat to Risperdal Consta. Notes that JNJ is committed to Risperdal Consta as evidenced by the heavy investment in Phase IV clinical trials for the product.

Reiterates Outperform and $24 target on ALKS, saying they are buyers of the stock.

Notablecalls: The LLY news hit in pre-market yesterday, yet there was no reaction in ALKS. I think we will get one today.

Comments

[dkhkch:]

Yes, a reaction of down on ALKS, closed at $12.94, down $.46 cents. Just do the opposite of what NC says.

2008 Mar 01 12:56 PM

[dkhkch:]

ABH Closed at $10.35 on Friday. NC cannot call stocks correctly (See Earlier Post)
NTRI closed Friday at $14.31, so hardly a "Bounce Play" as NC called it at $17. NC's calls are worthless. (See Earlier Post)

2008 Mar 01 12:59 PM

[Jonha's Pop:]

The problem with ALKS ? It's 'one-trick-pony'.

2008 Mar 05 04:47 PM