OK, so it might not be on track to finish the year as the best drug stock for 2007, but Forest Laboratories (NYSE:FRX) has fallen enough to start looking like an attractive value play. Even former New York Mets star Lenny "Nails" Dykstra, who writes for that other company, thinks Forest is a buy.

The drug company checked in Tuesday morning with its fiscal Q2 earnings, which proved a mixed bag. The stock is being punished by roughly 5%, because Forest Labs posted a 5% decrease in earnings per share. A licensing charge related to one of its investigational drug candidates hurt its bottom line. 

The company posted an 8.2% increase in net sales versus its year-ago quarter. This improvement fell slightly short of Wall Street's expectations, but there was a silver lining for shareholders.

The good news included a 7% increase in net sales of Forest Labs' cash crop, Lexapro, versus the year-ago Q2. Lexapro is an antidepressant that now accounts for about 61% of total revenue. Also, the company slightly increased its full-year earnings guidance, reporting that it had repurchased roughly 1.6% of its diluted shares during Q2.

In scanning some of the other candidates for the best drug stock of the year, the results have not been pretty. Genentech (NYSE:DNA) reported a 22% increase in earnings on Monday, yet the stock was trading down 3.8% Tuesday afternoon, after the company reported lower-than-expected Q3 revenue. Momenta Pharmaceuticals (NASDAQ:MNTA) opened down 5.4% on Friday on a Bear Stearns analyst's concerns related to the Food and Drug Administration delaying a decision on whether to approve its generic version of Sanofi-Aventis' (NYSE:SNY) anti-stroke drug, Lovenox. And shares of Endo Pharmaceuticals (NASDAQ:ENDP) have been trading near a 52-week low, because the company faces actual as well as potential patent challenges.

While Forest Labs may not be the likely candidate to win this contest, the way that things are shaping up will make for an interesting finish.

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