Cephalon ( CEPH) and Alkermes ( ALKS) rose early Monday after research firm Merriman Curhan Ford initiated coverage of the companies. Shares of Cephalon, a Frazer, Pa., drug developer, were lately up 23 cents, or 0.4%, at $63.82, but have traded close to $65. Merriman health care analyst E. Russell McAllister said he expects the volatility Cephalon has seen thus far in 2006 to continue through the end of the year. Still, while he advises investors to remain cautious about the stock and says near-term risks remain high, he has optimistic long-term expectations. McAllister gives Cephalon shares a neutral rating. Meanwhile, Alkermes, a maker of drug-delivery devices, was gaining 15 cents, or 0.8%, to $18.32. Based on the recent approval of Vivitrol, a treatment for alcohol dependence, "we believe Alkermes has demonstrated substantial development expertise and we are optimistic that one or more of Alkermes' products, supported by partnerships with industry leaders such as Cephalon, Eli Lilly ( LLY) and
Johnson & Johnson ( JNJ) will achieve blockbuster status," McAllister wrote in a research report Monday. He rates the stock a buy. LifePoint Hospitals ( LPNT) confirmed its second-quarter earnings guidance of 50 cents to 54 cents a share Monday, sending its stock 2.5% higher to $33.42. Irish drug maker Pinewood Laboratories is getting closer to a deal to be acquired by one of its numerous suitors, including generic drugmakers Teva Pharmaceutical Industries ( TEVA) and Barr Pharmaceuticals ( BRL), according to a recent report in The Times of London. Teva's shares rose 1% to $32.38, and Barr's shares were up 0.2% to $46.81 following the report. Final bids to acquire Pinewood, one of Ireland's top generic-drug firms, are expected to be submitted this week. The company holds the rights to manufacture more than 200 prescription and over-the-counter drugs, according to The Times. Shares of managed care company QMed ( QMED) fell 4.4% to $3.48 following a downgrade of the stock to a hold rating. Stifel Nicolaus analyst Thomas Carroll said the company's expenses are likely to increase, its disease management business "shows no promise" and "the shares have little ability to appreciate in 2006." Other health stocks on the move included Novogen ( NVGN), up 5.2% to $12.79, and drugmaker Biogen Idec ( BIIB) up 1.2% to $46.19. Biotech giant Amgen ( AMGN) gained 0.7% to $66.87 and heart-device maker St. Jude Medical ( STJ) rose 1.2% to $34.01.