Lundbeck Drops as SocGen Says Sales at Risk: Copenhagen Mover

H. Lundbeck A/S (LUN) fell to the lowest price in nine months in Copenhagen trading after Societe Generale SA said the Nordic region’s second-largest drugmaker needs acquisitions to reach revenue goals.

Lundbeck fell as much as 2.2 percent to 104.90 kroner, the lowest since Dec. 22, 2011. The stock declined 2.1 percent to 105 kroner at 1:26 p.m. making it today’s biggest loser in the OMX Copenhagen 20 index. (KFX)

Lundbeck is focusing on developing new drugs as patents on its bestselling anti-depressant, sold under the brand names Cipralex and Lexapro, expire. SocGen cut its recommendation today to hold from buy and said the Copenhagen-based drugmaker will have to acquire new medicines to sustain sales because its experimental drug Desmoteplase probably won’t reach the market. The bank said it hasn’t attached any value to the stroke treatment in its assessment of Lundbeck’s stock.

“Given the forecast revenue profile for the group, in our view, further in-licensing or acquisitions are needed to sustain revenue and profit growth over the long term,” Stephen McGarry, a London-based analyst with SocGen, said in the note. The bank lowered its share price estimate to 114 kroner from 135 kroner.

Lundbeck repeated on Aug. 8 a 2012 revenue forecast of as much as 15.2 billion kroner ($2.61 billion) and a target for earnings before interest and tax of as much as 2.5 billion kroner.

To contact the reporter on this story: Christian Wienberg in Copenhagen at cwienberg@bloomberg.net

To contact the editor responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net

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