Ami Fadia, an analyst from Needham, has initiated a new Buy rating on Alkermes (ALKS).
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Ami Fadia has given his Buy rating due to a combination of factors that highlight Alkermes’ promising future prospects. One key reason is the potential of ALKS 2680, which is anticipated to be a significant player in the market for rare sleep disorders. The drug’s upcoming Phase 2b trials are considered low-risk, building on the success of Phase 1b, and it is expected to offer a competitive efficacy and safety profile. The projections for ALKS 2680 suggest it could generate over $2 billion by 2030 and more than $3.5 billion by 2035, as it may become one of the first OX2R agonists with a broad label for NT1, NT2, and IH, offering multiple dosing options to cater to individual patient needs.
Additionally, Alkermes is strategically positioned to expand its pipeline beyond these three rare indications, with ALKS 4510 and ALKS 7290 set to enter clinical trials in 2025. The company’s existing business operations are robust, with an adjusted EBITDA exceeding $300 million, which is expected to sufficiently support the development and launch of ALKS 2680. The anticipated Phase 2b data releases for NT1, NT2, and IH are likely to drive further momentum for Alkermes, reinforcing the Buy rating.
In another report released on May 23, Mizuho Securities also maintained a Buy rating on the stock with a $40.00 price target.