Analyst Douglas Tsao of H.C. Wainwright reiterated a Hold rating on Alkermes, retaining the price target of $46.00.
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Douglas Tsao has given his Hold rating due to a combination of factors surrounding Alkermes’ recent strategic moves and market dynamics. The acquisition of Avadel Pharmaceuticals is seen as a strategic fit for Alkermes, allowing the company to enter the sleep market with Avadel’s commercial product, Lumryz. This acquisition is expected to be immediately accretive and provides Alkermes with an established infrastructure in the sleep business, which is a central focus for the company.
However, uncertainties remain, particularly with the competitive landscape in the oxybate class. The anticipated entry of orexin-based treatments and generic versions of Xyrem next year could pose challenges. While Lumryz has shown strong patient preference due to its once-daily dosing, the potential for competition from more efficacious orexin agonists and the impact of payer strategies on market dynamics contribute to the cautious outlook. These factors collectively justify the Hold rating, as they present both opportunities and risks for Alkermes moving forward.