ACADIA Pharmaceuticals Skyrockets on Accelerated NDA Filing
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of ACADIA Pharmaceuticals , a clinical-stage biopharmaceutical company, skyrocketed as much as 54% after it announced that it was filing an accelerated new drug application for Pimavanserin after discussions with the Food and Drug Administration.
So what: Pimavanserin, an experimental anti-psychosis drug for people with Parkinson's disease, breezed through its late-stage clinical trial, meeting the primary endpoint of "highly significant antipsychotic activity," and also meeting the secondary endpoint of improved motoric tolerability. ACADIA had been planning to run a confirmatory phase 3 trial, which it planned to begin enrolling patients in this quarter. However, the data thus far, and the discussion between the FDA and ACADIA, warranted an early drug submission.
Now what: I'd say this is definitely a step in the right direction toward getting Pimavanserin approved. But, let's also keep in mind that what the FDA does initially and what its panel or final ruling may indicate can occasionally be two different things. Another factor to consider is that most Wall Street peak sales estimates for Pimavanserin are around $300 million within the U.S. Acadia's valuation is pushing $950 million following today's pop, meaning it's valued at more than three times peak sales. To me, that seems a bit lofty for its first potential FDA-approved drug.
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The article ACADIA Pharmaceuticals Skyrockets on Accelerated NDA Filing originally appeared on Fool.com.Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.