Jefferies Comments on Alkermes (ALKS) Partnership Spilt with Eli Lilly (LLY) and Amylin (AMLN)
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Price: $49.06 -0.79%
Rating Summary:
17 Buy, 8 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
17 Buy, 8 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Jefferies is reiterating its Buy rating and $21 price target on shares of Alkermes (NASDAQ: ALKS) following the announcement that Eli Lilly (NYSE: LLY) & Amylin Pharmaceuticals (Nasdaq: AMLN) have ended their long-standing partnership for exenatide.
The firm notes that while the timing of the separation is a surprise, the fact that the companies have decided to split is not; kind of like the Kim Kardashian marriage. Jefferies highlights how AMLN had been suing LLY for the rights of exenatide after LLY signed a global diabetes partnership with Boehringer Ingelheim back in January 2011.
Jefferies believes the split will have little impact on ALKS in the near term since the royalty structure for Bydureon remains the same. The firm believes Bydureon will be a solid growth driver for ALKS in the future, but doesn't feel that it was the make it or break it story as it only forecasts total world wide sales of $800 million for the drug by 2015.
Jefferies highlights a few questions that are risen due to the seperation, What does this infer in terms of Bydureon's potential approvability?; Is dulaglutide better than Bydureon?; and Can Bydureon still be commercially successful?
An analyst at the firm comments, "It's just too early to know whether this will end up a (-) or (+) for Bydureon. LLY is a global diabetes leader; AMLN has all of 325 US reps detailing Byetta and no EU presence. However, with AMLN now able to drive commercial efforts for Byetta/Bydureon in a single, unified message, we see potential for upside. One key will be AMLN's ability to secure a new ex-US partner; who that partner ends up being could be a tell-tale sign."
For an analyst ratings summary and ratings history on Alkermes click here. For more ratings news on Alkermes click here.
Shares of Alkermes closed at $16.11 yesterday.
The firm notes that while the timing of the separation is a surprise, the fact that the companies have decided to split is not; kind of like the Kim Kardashian marriage. Jefferies highlights how AMLN had been suing LLY for the rights of exenatide after LLY signed a global diabetes partnership with Boehringer Ingelheim back in January 2011.
Jefferies believes the split will have little impact on ALKS in the near term since the royalty structure for Bydureon remains the same. The firm believes Bydureon will be a solid growth driver for ALKS in the future, but doesn't feel that it was the make it or break it story as it only forecasts total world wide sales of $800 million for the drug by 2015.
Jefferies highlights a few questions that are risen due to the seperation, What does this infer in terms of Bydureon's potential approvability?; Is dulaglutide better than Bydureon?; and Can Bydureon still be commercially successful?
An analyst at the firm comments, "It's just too early to know whether this will end up a (-) or (+) for Bydureon. LLY is a global diabetes leader; AMLN has all of 325 US reps detailing Byetta and no EU presence. However, with AMLN now able to drive commercial efforts for Byetta/Bydureon in a single, unified message, we see potential for upside. One key will be AMLN's ability to secure a new ex-US partner; who that partner ends up being could be a tell-tale sign."
For an analyst ratings summary and ratings history on Alkermes click here. For more ratings news on Alkermes click here.
Shares of Alkermes closed at $16.11 yesterday.
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