Forest Labs Stock Soars on Patent Victory for Antidepressant Lexapro
NEW YORK -- Shares of drug maker Forest Laboratories Inc. soared Friday, a day after a federal judge upheld a patent for the antidepressant Lexapro.
Shares of Forest Labs rose $6, or 16 percent, to close at $44.40 on the New York Stock Exchange, near the high end of a 52-week range of $34.54 to $48.51.
Judge Joseph J. Farnan of the U.S. District Court in Delaware ruled that the patent on Lexapro was valid and infringed by a generic version proposed by Teva Pharmaceutical Industries Ltd. The patent expires in March 2012.
The ruling spurred at least two investment backs to upgrade their ratings on Forest Lab's stock. Jefferies & Co. analyst David Windley upgraded the shares to a buy from a hold, saying the decision removed a factor that had been stifling the stock and diverting attention away from the company's pipeline of other products.
Patricia Bank, an analyst at Pacific Growth Equities, raised Forest Labs to a buy from neutral, noting a rebound in the antidepressant market, a solid pipeline and the possibility that sales of Alzheimer's drug Namenda could be better than expected.
Forest labs sued Ivax Corp., which was acquired by Teva this year, when it applied to the Food and Drug Administration to make a generic version of Lexapro. In late May, the agency granted generic approval to Ivax.
Representatives at Teva declined to comment on the ruling.
Lexapro sales accounted for $1.87 billion of Forest's $2.96 billion in 2005 revenue.
NEW YORK -- Shares of drug maker Forest Laboratories Inc. soared Friday, a day after a federal judge upheld a patent for the antidepressant Lexapro.
Shares of Forest Labs rose $6, or 16 percent, to close at $44.40 on the New York Stock Exchange, near the high end of a 52-week range of $34.54 to $48.51.
Judge Joseph J. Farnan of the U.S. District Court in Delaware ruled that the patent on Lexapro was valid and infringed by a generic version proposed by Teva Pharmaceutical Industries Ltd. The patent expires in March 2012.
The ruling spurred at least two investment backs to upgrade their ratings on Forest Lab's stock. Jefferies & Co. analyst David Windley upgraded the shares to a buy from a hold, saying the decision removed a factor that had been stifling the stock and diverting attention away from the company's pipeline of other products.
Patricia Bank, an analyst at Pacific Growth Equities, raised Forest Labs to a buy from neutral, noting a rebound in the antidepressant market, a solid pipeline and the possibility that sales of Alzheimer's drug Namenda could be better than expected.
Forest labs sued Ivax Corp., which was acquired by Teva this year, when it applied to the Food and Drug Administration to make a generic version of Lexapro. In late May, the agency granted generic approval to Ivax.
Representatives at Teva declined to comment on the ruling.
Lexapro sales accounted for $1.87 billion of Forest's $2.96 billion in 2005 revenue.
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