Shares of drugmaker Cephalon ( CEPH) rose Tuesday after J.P. Morgan upgraded the stock to overweight from neutral on strong sales trends.

"We believe CEPH shares deserve to trade at a premium," wrote J.P. Morgan health care analyst Adam Greene in a research report, saying the company's current valuation leaves room for upside. Shares rose 21 cents to $70.52.

"While epilepsy drug Gabitril prescriptions have been in a free fall for nearly two years, prescriptions now appear to have stabilized," Greene says. "We expect the company to continue to take sizable price increases to offset some of the downward spiral."

Since the beginning of 2005, Cephalon has increased its price on Gabitril three times, the analyst notes.

J.P. Morgan Securities owns shares of Cephalon and makes a market in the stock. Cephalon is slated to report its fourth-quarter earnings on Feb. 14.

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