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At around $44,



shares are too expensive, an analyst at UBS said Tuesday morning.

At the current price, Meirav Chovav believes upside potential is limited, and cut the company's investment rating to reduce from neutral. Chovav maintained a $35 price target.

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Biogen's Avonex and Amevive core product portfolio concern Chovav. While Avonex is the company's principal driver of revenue, rival Rebif, made by Sereno/Pfizer, holds a 10% market share, even though it entered the market late in the first quarter of 2002. Further, Chovav believes Rebif might gain more market share over Avonex after recently published data on Rebif's long-term efficacy and Pfizer's expected increased emphasis on sales.

Regarding Biogen's psoriasis drug, Amevive, the brokerage feels the existing estimates are too optimistic. Bigoen expects about $85 million in Amevive revenue in 2003, while UBS expects $40 million. Rivals Enbrel and Raptiva might pressure sales, in part, because both have been found to work rapidly, Chovav said. Meanwhile, potential Amevive patients can get bogged down in the insurance verification process.

Chovav said downward revisions of the company's EPS estimates are possible in the next few years, with Amevive potentially disappointing and Rebif hurting Avonex sales faster than expected. Already the analyst feels UBS' 2003 EPS estimate of $1.60 and 2004-05 estimate of $1.56 are "a realistic best case scenario."

Analysts' consensus estimate is $1.78 a share in 2003 and $1.94 a share, on average, in 2004.

Shares of the company were falling 2.3% in Instinet premarket trading to $43.25.