Alkermes (ALKS) stock has been re-rated following a recent orexin-peer takeout, but upcoming orexin updates risk eroding newly ascribed orexin-related value, BofA Securities said in a research note Monday.

ALKS largely trades on data points informing the commercial opportunity for its phase 2 and phase 3 pipeline asset orexin in hypersomnolent disorders, the brokerage said.

The firm said possible negative catalysts include Alkermes' phase 2 Vibrance-3 data in idiopathic hypersomnia, reading out late 2026 or early 2027.

BofA sees idiopathic hypersomnia as a risky segment in the broader hypersomnia market, as competition from Takeda Pharmaceutical's (TAK) phase 2 data for TAK-360 in narcolepsy type 2 and idiopathic hypersomnia could reinforce the narrative that the market is crowded. Key opinion leaders have also flagged lower unmet need for another wake promoter, and BofA sees profit and loss risk as well, according to the note.

BofA downgraded Alkermes to underperform from neutral with a price target of $38.

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