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1. Company Snapshot

1.a. Company Description

Alkermes plc, a biopharmaceutical company, researches, develops, and commercializes pharmaceutical products to address unmet medical needs of patients in various therapeutic areas in the United States, Ireland, and internationally.Its marketed products include ARISTADA, an intramuscular injectable suspension for the treatment of schizophrenia; VIVITROL for the treatment of alcohol and prevention of opioid dependence; RISPERDAL CONSTA for the treatment of schizophrenia and bipolar I disorder; INVEGA SUSTENNA for the treatment of schizophrenia and schizoaffective disorder; XEPLION, INVEGA TRINZA, and TREVICTA to treat schizophrenia and schizoaffective; and VUMERITY for the treatment of relapsing forms of multiple sclerosis in adults, including clinically isolated syndrome, relapsing-remitting and active secondary progressive diseases.The company is also developing LYBALVI, an oral atypical antipsychotic drug candidate for the treatment of adults with schizophrenia and bipolar I disorder; and nemvaleukin alfa, an engineered fusion protein to expand tumor-killing immune cells and to avoid the activation of immunosuppressive cells.


It has collaboration agreements primarily with Janssen Pharmaceutica N.V., Janssen Pharmaceutica Inc, and Janssen Pharmaceutica International.Alkermes plc was founded in 1987 and is headquartered in Dublin, Ireland.

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1.b. Last Insights on ALKS

Alkermes' recent performance was negatively impacted by an analyst downgrade. Wells Fargo lowered its price target on the stock from $42.00 to $37.00, citing an overweight rating. This downgrade led to a 6.2% decline in the stock price. Despite a consensus "Moderate Buy" rating from 16 research firms, with 11 buy recommendations, the stock faced headwinds. The company's Q3 earnings report showed strong revenue growth and robust profitability, but the downgrade overshadowed these positive results. Institutional investors, such as Allspring Global Investments Holdings LLC, also reduced their holdings.

1.c. Company Highlights

2. Alkermes' Strong Q3 Earnings and Raised 2025 Guidance

Alkermes delivered a robust third quarter with total revenues of $394.2 million, driven by proprietary products generating net sales of $317.4 million, reflecting 16% year-over-year growth. The company's financial performance was robust, with GAAP net income of $82.8 million, EBITDA of $96.9 million, and adjusted EBITDA of $121.5 million. Earnings per share (EPS) came in at $0.4911, beating analyst estimates of $0.42. The company's commercial portfolio performed well, with VIVITROL, ARISTADA, and LYBALVI net sales growing 32% year-over-year.

Publication Date: Nov -02

📋 Highlights
  • Q3 Revenue Growth:: Total revenues reached $394.2M, driven by 16% YoY growth in proprietary product net sales ($317.4M).
  • 2025 Financial Projections:: Raised 2025 revenue guidance to $1.43B–$1.49B, with adjusted EBITDA of $365M–$385M.
  • Product Performance:: LYBALVI net sales surged 32% YoY to $98.2M, while VIVITROL and ARISTADA sales were $121.1M and $98.1M, respectively.
  • Avadel Acquisition Impact:: Expected to add LUMRYZ, forecasting $265M–$275M in 2025 net revenue, diversifying Alkermes’ portfolio.
  • Pipeline Progress:: Alixorexton entering Phase III trials in Q1 2025 for narcolepsy, with potential expansion into psychiatric/neurological indications.

Revenue Growth and Guidance

The company is raising its 2025 financial expectations, with total revenues expected to be $1.43 billion to $1.49 billion. The proposed acquisition of Avadel Pharmaceuticals is expected to close in Q1 and will add LUMRYZ, an FDA-approved oxybate for narcolepsy, to Alkermes' portfolio, which is expected to generate $265– to $275 million in net revenue in 2025. Analysts estimate next year's revenue growth at 15.7%, indicating a strong outlook for the company's top-line performance.

Commercial Portfolio Performance

LYBALVI net sales grew 32% year-over-year, driven by a broad label and strong efficacy profile, with new patient starts growing more towards the bipolar population. The company expects to continue growing demand for LYBALVI in the fourth quarter. ARISTADA net sales were $98.1 million, with a gross-to-net ratio of approximately 53% for the full year.

Pipeline Updates

The company's orexin 2 receptor agonist pipeline is advancing rapidly, with alixorexton demonstrating compelling therapeutic benefits in patients with narcolepsy type 1. Alkermes is moving rapidly to initiate a Phase III registrational program for alixorexton in the first quarter of next year. The company expects to have data from the NT2 study in November, which will comprise the package for an end-of-Phase II meeting with the FDA.

Valuation Metrics

Alkermes' current valuation metrics indicate a P/E Ratio of 14.96, P/B Ratio of 2.92, and EV/EBITDA of 10.38. The company's ROE is 21.4%, and ROIC is 16.24%. These metrics suggest that the company's strong financial performance and growth prospects are reflected in its valuation, but the market still expects further growth, as indicated by the EV/EBITDA ratio.

Acquisition and Future Plans

The proposed acquisition of Avadel Pharmaceuticals will diversify Alkermes' commercial portfolio and strengthen its profitability. The company plans to bring alixorexton to patients outside the US, with clinical trials ongoing in Europe and Asia. The company's management believes that the acquisition is a logical extension of its business and will drive future growth.

3. NewsRoom

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Fisher Asset Management LLC Sells 29,734 Shares of Alkermes plc $ALKS

Dec -04

Source: defenseworld.net

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Alkermes to Participate in Two Upcoming Investor Conferences

Nov -25

Source: businesswire.com

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ALKS Raises Its Offer to Buy Avadel In Response to Lundbeck's Proposal

Nov -20

Source: zacks.com

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Looking for Earnings Beat? Buy These 5 Top-Ranked Stocks

Nov -19

Source: zacks.com

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Alkermes raises offer for Avadel after Lundbeck bid

Nov -19

Source: reuters.com

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Alkermes plc (ALKS) Shareholder/Analyst Call Transcript

Nov -17

Source: seekingalpha.com

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Alkermes (NASDAQ:ALKS) Stock Price Down 6.2% Following Analyst Downgrade

Nov -15

Source: defenseworld.net

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Market Today: Data Delays, CEO Shifts, M&A and Deals

Nov -14

Source: gurufocus.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.94%)

6. Segments

Product

Expected Growth: 8.97%

Alkermes plc's 8.97% growth is driven by increasing demand for its mental health and addiction treatment products, such as Vivitrol and Aristada. Strong sales growth in the US market, coupled with expanding pipeline and strategic partnerships, contribute to the company's growth momentum.

Manufacturing and Royalty

Expected Growth: 8.9%

Alkermes plc's 8.9% growth in Manufacturing and Royalty segments is driven by increasing demand for its proprietary products, such as Vivitrol and Aristada, as well as growing royalties from its partnerships, particularly with Indivior. Additionally, the company's strategic investments in R&D and manufacturing capacity expansions have improved operational efficiency, contributing to the segment's growth.

Research and Development

Expected Growth: 8.5%

Alkermes plc's 8.5% R&D growth driven by increasing investment in pipeline expansion, particularly in CNS and oncology therapeutic areas. Strong demand for innovative treatments and growing partnerships with pharmaceutical companies also contribute to growth. Additionally, the company's focus on digital health and technology advancements supports R&D expansion.

7. Detailed Products

Vivitrol

A medication-assisted treatment for opioid and alcohol dependence

Aristada

An atypical antipsychotic medication for the treatment of schizophrenia

Vivitrol Co-pay Savings Program

A patient assistance program for Vivitrol

Risperdal Consta

An atypical antipsychotic medication for the treatment of schizophrenia and bipolar I disorder

Invega Sustenna

An atypical antipsychotic medication for the treatment of schizophrenia

Xeplion

An atypical antipsychotic medication for the treatment of schizophrenia

8. Alkermes plc's Porter Forces

Forces Ranking

Threat Of Substitutes

Alkermes plc operates in a highly regulated industry, which limits the threat of substitutes. However, the company's dependence on a few key products makes it vulnerable to competition from alternative treatments.

Bargaining Power Of Customers

Alkermes plc's customers, primarily healthcare providers and patients, have limited bargaining power due to the company's strong brand recognition and limited competition in certain therapeutic areas.

Bargaining Power Of Suppliers

Alkermes plc relies on a few key suppliers for raw materials and manufacturing services, which gives them some bargaining power. However, the company's scale and diversification efforts mitigate this risk.

Threat Of New Entrants

The pharmaceutical industry has high barriers to entry, including significant regulatory hurdles and capital requirements, which limits the threat of new entrants.

Intensity Of Rivalry

Alkermes plc operates in a highly competitive industry, with several established players and a high level of marketing and R&D expenditure. This intensity of rivalry puts pressure on the company's pricing and market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 19.47%
Debt Cost 6.43%
Equity Weight 80.53%
Equity Cost 6.83%
WACC 6.75%
Leverage 24.17%

11. Quality Control: Alkermes plc passed 9 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Genmab

A-Score: 5.9/10

Value: 3.7

Growth: 9.7

Quality: 9.4

Yield: 0.0

Momentum: 8.0

Volatility: 4.3

1-Year Total Return ->

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Stock-Card
Alkermes

A-Score: 5.2/10

Value: 4.4

Growth: 8.4

Quality: 8.9

Yield: 0.0

Momentum: 6.0

Volatility: 3.7

1-Year Total Return ->

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Stock-Card
ALK-Abelló

A-Score: 5.0/10

Value: 0.5

Growth: 8.2

Quality: 7.5

Yield: 0.0

Momentum: 8.0

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Jazz Pharmaceuticals

A-Score: 4.9/10

Value: 5.6

Growth: 7.1

Quality: 2.4

Yield: 0.0

Momentum: 8.5

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
Camurus

A-Score: 4.4/10

Value: 0.0

Growth: 9.3

Quality: 9.0

Yield: 0.0

Momentum: 6.0

Volatility: 2.0

1-Year Total Return ->

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Stock-Card
Zealand Pharma

A-Score: 3.2/10

Value: 7.0

Growth: 2.2

Quality: 9.9

Yield: 0.0

Momentum: 0.0

Volatility: 0.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

29.52$

Current Price

29.52$

Potential

-0.00%

Expected Cash-Flows