ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) shares touched a new 52-week high of $41.20 Thursday. The reason? The drug maker announced that it received FDA Breakthrough Therapy Designation (BTD) for pimavanserin (Nuplazid) in the broad indication of “dementia related psychosis” along with plans to initiate a Phase 3 study (HARMONY) across a variety of disease subtypes.
In addition, ACADIA announced discontinuation of the Ph2 SERENE trial of pimavanserin in Alzheimer’s Disease agitation. The trial remains blinded, and patients who have been dosed will continue in the trial until its conclusion, though management does not expect to further pursue the AD agitation indication. The decision was made in large part to prevent overlap of clinical trial sites and potential patients.
In reaction, J.P. Morgan analyst Cory Kasimov reiterated an Overweight rating on ACADIA shares with a price target of $50, which represents a potential upside of 29% from where the stock is currently trading. (To watch Kasimov’s track record, click here)
Kasimov opined, “The BTD follows an EOP2 meeting with the FDA based on data generated from both the Phase 2 -019 study in Alzheimer’s disease psychosis and the Phase 3 -020 study in Parkinson’s disease psychosis (for which Nuplazid is of course approved). In addition to dementia associated with Alzheimer’s and Parkinson’s, the BTD encompasses several other etiologies such as vascular and frontotemporal dementia. While somewhat confusing at first glance, overall we see this development as a step in the right direction in helping to further crystallize ACAD’s path towards future label expansions beyond just PDP. With that said, it’s difficult to know at his point how the data will ultimately shake out given this relatively unconventional development strategy.”
TipRanks reveals that ACAD has a Strong Buy analyst consensus rating with 6 back-to-back buy ratings in the last three months. Meanwhile the average analyst price target of $52.17 suggests the stock still has upside potential of just over 34% from the current share price for the next 12 months.