Alkermes Falls Along With Biotech Index After Drug's Approval

  • Long-acting schizophrenia injection approved by FDA Monday
  • Shares fall 4.7 percent, biotechnology index down as well

Drugmaker Alkermes Plc fell Tuesday after receiving U.S. regulatory approval for a schizophrenia treatment, and an analyst predicted that uptake of the drug could be slow at first.

Alkermes’s drug, called Aristada, is a long-acting injectable medicine with options to be taken once monthly or every six weeks, the company said Monday in a statement announcing the U.S. Food and Drug Administration’s approval of the drug. The treatment is intended as an alternative to oral anti-psychotic medications taken daily. In a final-stage trial, Aristada helped reduce patients’ schizophrenia symptoms.

“Sales growth for Aristada could be blunted in the short-term,” said Vamil Divan, an analyst with Credit Suisse Group AG. “Over time we see market penetration picking up quickly as both patients and physicians become accustomed to the product and subsequently increase their use.”

Shares of the Dublin-based biotechnology company fell 4.7 percent to $56.97 as of 2:01 p.m. in New York, after rising during premarket trading. The Nasdaq Biotechnology Index, of which Alkermes is a member, fell as much as 6.6 percent.

Alkermes, which focuses on central nervous system diseases, is developing another schizophrenia drug, ALKS 3831, which is in clinical trials, as well as treatments for multiple sclerosis and major depressive disorder.

Aristada will cost about $1,500 a month, the company said on a conference call Tuesday, though executives wouldn’t give the exact price. Alkermes said the cost for an individual patient would depend on the dose, and would be comparable to already approved long-acting versions of schizophrenia drugs such as Johnson & Johnson’s Risperdal Consta and Invega Sustenna.

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