Alkermes initiated with an Outperform at Baird

Baird initiated coverage of Alkermes with an Outperform rating and $37 price target. The company’s 2024 guidance and its over $800M in cash as of the end of 2023 “provides a solid floor value for the stock,” the analyst tells investors in a research note. The firm believes Alkermes’ key pipeline agent ALKS 2680 has strong potential for narcolepsy type 1. The drug works on the causal pathway of the disease, with compelling Phase 1b data to date, says Baird. It attributes $7 per share to ALKS 2680 in narcolepsy type 1 and leaves narcolepsy type 2 and idiopathic hypersomnia as upside.