DepoMed (DEPO) Price Increases Coming - Janney Montgomery Scott (ENDP) (COLL)

Janney Montgomery Scott analyst, Ken Trbovich, thinks a price increase is on the horizon for DepoMed Inc (NASDAQ: DEPO). DEPO last increased prices in Dec. 2015, which we think sets it up to do so again in the August-October period this year. In calendar years 2014 and 2015, the company took a total of 4-5 price increases for each of its legacy products (Gralise, Cambia, Zipsor and Lazanda). DEPO's frequency of adjusting price has slowed, already going beyond the 5-6 month typical interval. This suggests the next round of increases is likely to begin in 3Q16.

Growth of the Nucynta franchise remains the primary driver of the DEPO model. While the market for long-acting opioids to treat chronic pain has seen the recent launch of Endo International plc's Belbuca, will soon see the launch of Collegium's, and may see as many as four others before year end,

The firm maintained a Buy rating and fair value target of $28 on DEPO.

SI NOTE: Shares of Depomed are up 11% since being highlighted in the Stealth Growth Insider newsletter on 5/16.

For an analyst ratings summary and ratings history on DepoMed Inc click here. For more ratings news on DepoMed Inc click here.

Shares of DepoMed Inc closed at $20.13 yesterday.

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