Biogen Idec Inc. is poised to gain from higher prices for multiple sclerosis drugs Avonex and Tysabri, according to one analyst.
Citi Investment Research analyst Yaron Werber said higher prices for Avonex and Tysabri "could result in meaningful upside" for the rest of 2008, though the higher prices will have little impact this quarter.
Werber said the company raised prices in June following German drug maker Merck KGaA's decision to raise prices on multiple sclerosis drug Rebif.
"We believe that Avonex's price will continue to be increased as long as the competition does so as well," Werber wrote in a client note.
Werber rates shares of Biogen "Hold" with a $72 price target, which implies upside of 21.3 percent to Tuesday's closing price of $59.34.
In June, Carl Icahn lost his campaign to elect a slate of dissident nominees to Biogen's board, which Icahn hoped would eventually spark a sale of Biogen. The company has treatments on the market for rheumatoid arthritis, in addition to multiple sclerosis.
Multiple sclerosis is a disease that attacks the central nervous system and affects about 400,000 people in the United States, according to the National Multiple Sclerosis Society