Jazz Pharmaceuticals Inc. (Nasdaq: JAZZ)

Jazz Pharmaceuticals Inc. (JAZZ) engages in the development and commercialization of innovative products in the area of neurology and psychiatry in the United States. The Company’s commercial products include Xyrem for the treatment of narcolepsy symptoms of daytime drowsiness and cataplexy; and Luvox CR for anxiety and obsessive compulsive disorders. The Company’s product candidates presently in clinical trials include: JZP-6 (sodium oxybate) for the treatment of fibromyalgia, in phase III clinical trials; JZP-7 (transdermal ropinirole gel) for the treatment of restless legs syndrome, in phase II clinical trials; JZP-8 (intranasal clonazepam) for the treatment of recurrent acute repetitive seizures, in phase II clinical trials; and JZP-4 (sodium channel antagonist) for the treatment of epilepsy and bipolar disorder, in phase I clinical trials.

Founded in 2003, the Company is headquartered in Palo Alto, California.

Source: Reuters.com, SEC Filings.

Financial Summary

Analyst Consensus

The mean of three analysts polled by Thomson Reuters rate shares of JAZZ a “Hold.”

Analyst Recommendations and Revisions

Source: Reuters.com

Source: Reuters.com

Historical Surprises

Source: Reuters.com

Investment Highlights

The Company markets two drug therapies, Xyrem (sodium oxybate) and Luvox CR (fluvoxamine maleate), and develops one late-stage drug therapy, JZP-6 (sodium oxybate).

Xyrem (sodium oxybate) is approved by the U.S. Food and Drug Administration (FDA) for patients suffering from daytime sleepiness and cataplexy (sudden and transient episode of loss of muscle tone), both associated with narcolepsy-a condition characterized as an inability of the brain to regulate sleep-wake cycles.

Approximately 150,000 individuals in the United States are affected by narcolepsy, according to the National Institutes of Health (NIH). The Company markets Xyrem through a specialty sales force to neurologists, pulmonologists and psychiatrists.

Since acquiring the rights to Xyrem in June 2005, the Company has grown its sales force to promote the drug as well as licensed the commercialization of Xyrem internationally in 54 countries.

Luvox CR (fluvoxamine maleate) is the second drug therapy of the Company approved by the FDA in February of 2008 for the treatment of obsessive compulsive and social anxiety disorder. In March 2008, the Company began shipping Luvox Cr to wholesalers and initiated promotion of the drug through its specialty sales force the following month. Luvox is a formulated Selective Serotonin Reuptake Inhibitor (SSRI) commonly used to treat obsessive compulsive and social disorders, which collectively affects approximately 17.5 million adults in the United States, according to the National Institute of Mental Health. The Company has exclusive rights to distribute the drug within the United States, while Solvay Pharmaceuticals Inc. (the company that sold the U.S. rights to JAZZ in January 2007) retains international rights.

JZP-6 (sodium oxybate)–the active ingredient in Xyrem–is in the process of FDA clinical trials for the treatment of fibromyalgia-a diagnosis characterized by generalized fatigue and muscle pain. Fibromyalgia afflicts approximately 3% of the U.S. adult population, or 6 million Americans (mostly females), according to the American College of Rheumatology.

JZP-6 is presently in phase III clinical trials, which revealed positive top-line results from two pivotal trials of randomized, double-blind, placebo-controlled studies demonstrating efficacy to significantly relieve pain and fatigue. The Company intends to submit a new drug application (NDA) for JZP-6 by year end.

Currently, there is no effective treatment of fibromyalgia approved in the United States, Japan and Europe. According to the research firm, Datamonitor, the treatment of fibromyalgia is expected to reach approximately $1.7 billion in 2016.

Recent Company News

On October 14, the Company announced that it will present data relating to phase III pivotal clinical trials of JZP-6 in November at the US Psychiatric and Mental Health Congress in Las Vegas, Nevada. The Company intends to submit a NDA for JZP-6 with the U.S. Food and Drug Administration by year end.

Technical Analysis

JAZZ trades below its 13-day moving average. This bearish sign is significant because the 13-day moving average is negatively sloped.

The MACD for JAZZ currently indicates a bearish signal. The MACD is below the signal line, a 9-day moving average. The MACD is below the critical level of 0, which implies that the underlying moving averages are trending lower. Overall, the chart is bearish.

Comparative Analysis

Source: Thomson Financial

Insider Trading Activity

Report Disclaimer

DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice.

The information contained in our report should be viewed as commercial advertisement and is not intended to be investment advice. The report is not provided to any particular individual with a view toward their individual circumstances. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

Our newsletter and website have been prepared for informational purposes only and are not intended to be used as a complete source of information on any particular company. An individual should never invest in the securities of any of the companies profiled based solely on information contained in our report. Individuals should assume that all information contained in the report about profiled companies is not trustworthy unless verified by their own independent research.

Any individual who chooses to invest in any securities should do so with caution. Investing in securities is speculative and carries a high degree of risk; you may lose some or all of the money that is invested. Always research your own investments and consult with a registered investment advisor or licensed stock broker before investing.

Information contained in our report will contain “forward looking statements” as defined under Section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934. Subscribers are cautioned not to place undue reliance upon these forward looking statements. These forward looking statements are subject to a number of known and unknown risks and uncertainties outside of our control that could cause actual operations or results to differ materially from those anticipated. Factors that could affect performance include, but are not limited to, those factors that are discussed in each profiled company’s most recent reports or registration statements filed with the SEC. You should consider these factors in evaluating the forward looking statements included in the report and not place undue reliance upon such statements.

We are committed to providing factual information on the companies that are profiled. However, we do not provide any assurance as to the accuracy or completeness of the information provided, including information regarding a profiled company’s plans or ability to effect any planned or proposed actions. We have no first-hand knowledge of any profiled company’s operations and therefore cannot comment on their capabilities, intent, resources, nor experience and we make no attempt to do so. Statistical information, dollar amounts, and market size data was provided by the subject company and related sources which we believe to be reliable.

To the fullest extent of the law, we will not be liable to any person or entity for the quality, accuracy, completeness, reliability, or timeliness of the information provided in the report, or for any direct, indirect, consequential, incidental, special or punitive damages that may arise out of the use of information we provide to any person or entity (including, but not limited to, lost profits, loss of opportunities, trading losses, and damages that may result from any inaccuracy or incompleteness of this information).

We encourage you to invest carefully and read investment information available at the websites of the SEC at http://www.sec.gov and FINRA at http://www.finra.org.