Alkermes plc (NASDAQ:ALKS) showcases a robust Return on Invested Capital (ROIC) of 22.09% against a Weighted Average Cost of Capital (WACC) of 7.02%, indicating efficient capital utilization.
Compared to peers, Alkermes has a higher ROIC to WACC ratio, highlighting its superior performance in generating returns above its cost of capital.
Alnylam Pharmaceuticals and Nektar Therapeutics struggle with negative ROIC to WACC ratios, contrasting sharply with Alkermes’ strong performance.

Alkermes plc (NASDAQ:ALKS) is a biopharmaceutical company that focuses on developing innovative medicines for central nervous system disorders, including schizophrenia, depression, and addiction. The company operates in a competitive landscape alongside peers like Neurocrine Biosciences, Alnylam Pharmaceuticals, BioMarin Pharmaceutical, Incyte Corporation, and Nektar Therapeutics. These companies also focus on developing treatments for various medical conditions, making the industry highly competitive.

Alkermes showcases a robust Return on Invested Capital (ROIC) of 22.09% against a Weighted Average Cost of Capital (WACC) of 7.02%. This results in a ROIC to WACC ratio of 3.15, indicating that Alkermes is generating returns significantly above its cost of capital. This is a strong indicator of the company’s ability to create value for its shareholders by efficiently utilizing its invested capital.

In comparison, Neurocrine Biosciences has a ROIC of 12.66% and a WACC of 5.57%, resulting in a ROIC to WACC ratio of 2.27. While this is positive, it is still lower than Alkermes, suggesting that Neurocrine is less efficient in generating returns over its cost of capital. This highlights Alkermes’ superior performance in capital utilization compared to its peers.

Alnylam Pharmaceuticals and Nektar Therapeutics face challenges with negative ROIC to WACC ratios of -0.70 and -2.38, respectively. Alnylam’s ROIC of -4.21% against a WACC of 6.02% and Nektar’s ROIC of -34.60% against a WACC of 14.52% indicate that these companies are struggling to generate returns above their cost of capital. This contrasts sharply with Alkermes’ strong performance.

BioMarin Pharmaceutical and Incyte Corporation also lag behind Alkermes, with ROIC to WACC ratios of 1.04 and 0.02, respectively. BioMarin’s ROIC of 5.68% and Incyte’s ROIC of 0.17% suggest that these companies are only marginally or not at all generating returns above their cost of capital. This further underscores Alkermes’ efficiency in capital utilization and value creation.