Forest Laboratories ( FRX) is the second-worst performer in the Amex Pharmaceutical Index (DRG) year to date, down 24% at Wednesday's closing price of $38.40 (up $1.20). One reason for the poor performance is a problem that affects most drugmakers -- investors are worried about the lack of potential blockbuster drugs in the company's clinical pipeline. But Forest has now received two analyst upgrades this week, focusing on the stock's discount valuation. At current levels, the shares are trading at just 12.3 times expected fiscal 2008 (ending March) earnings of $3.12 per share. That represents a 14% discount to the company's historical average valuation, and is also below the mid- to high-teens earnings multiples that competitors Merck ( MRK), Eli Lilly ( LLY) and Abbott Laboratories ( ABT) command. With that in mind, I'm here to answer readers' questions: Should you buy shares in Forest Laboratories? Does Forest Labs hold value at these prices, or is the stock bad medicine? On Sept. 5, Forest won a key court appeal, blocking Teva Pharmaceutical ( TEVA) from making a generic version of its antidepressant Lexapro until the patent expires in 2012. The drug generated some $2.1 billion of revenue last year, or more than 60% of the company's total sales. Forest's other key product is Alzheimer's treatment Namenda, which has patent protection until 2013, and also accounts for about 20% of total revenue. Namenda sales grew 27% year over year in the fiscal first quarter (ended June) to $191.7 million, and is also expected to reach $1 billion of annual revenue by 2010. To watch David Peltier's video take of this column, click here .