"Alkermes (NASDAQ: ALKS) recently produced a two-pronged positive surprise; an increase in the size of their already existing stock buyback program and a boost in their financial guidance," says John McCamant.

In his Medical Technology Stock Letter, the biotech sector expert looks at this firm which focuses on treatments for central nervous system disorders, alcohol depenence, and schizophrenia. Here is his review.

"Both of these moves were made possible by the announcement that ALKS has received a $40 million payment from Eli Lilly, their former partner for the now defunct AIR Insulin program.

"ALKS now has the authorization to buy back up to $215 million in common stock. To date, the company has bought back roughly eight million shares of common stock for a cost of about $106 million.

"Additionally, as noted, ALKS has upped their financial guidance for fiscal 2009. Operating income for the year is now expected to end up on the positive side of the ledger, with ALKS anticipating $10-$15 million for the full year.

Alkermes (NASDAQ: ALKS) is a biotechnology company that makes extended-release products for the treatment of chronic diseases. The firm developed and manufactures Vivitrol, a treatment for alcohol dependence that partner Cephalon (NASDAQ: CEPH) markets in the United States. It also makes Risperdal Consta, a long-acting version of Janssen's schizophrenia medication Risperdal. Alkermes' pipeline includes extended-release injectable, pulmonary and oral products for the treatment of central nervous system disorders, addiction and diabetes. Bristol-Myers Squibb (NYSE: BMY) and Johnson & Johnson (NYSE: JNJ) are competitors.

The firm pleased investors earlier in the week, when it expanded its stock repurchase program by $40 million. Management also guided FY09 EPS to 11-16 cents and FY09 revenues to $200-$225 million. Analysts had been looking for a 10 cent per share loss and $194.89 million. Fiscal year cash flow from operations was expected to total $25-$30 million, as compared to an original $1-$5 million estimate.

"Biotechs are the ultimate recession-proof market segment," says Michael Shulman, who recommends Alkermes (NASDAQ: ALKS).

The editor of The ChangeWave Biotech Investor explains, "As investors flee companies that will be hurt by a credit crunch, money has flowed into many biotechsFears of an economic softening are pushing investors to recession-proof companies that can grow despite the economy."

Further, he contends, many biotech companies are cheap. He says, "They are at technical as well as fundamental bottoms, and sitting on large cash balances."

The bottom line, he notes: "Start considering bottom-fishing, right now. Go with growth, and companies with cash, and a good chart." One stock that he believes is "getting ready for an interesting few months" is Alkermes, the drug-delivery company.