Cowen Chimes in on ACADIA Pharmaceuticals Inc. (ACAD) Amid Slow But Steady Nuplazid Launch

ACADIA Pharmaceuticals Inc.’s (NASDAQ:ACAD) pipeline drug Nuplazid was approved in May to treat Parkinson’s Disease Psychosis (PDP) and launched the following month. Cowen top analyst Ritu Baral weighs in with a first impression of the launch thus far and reiterates an Outperform rating on ACAD with a price target of $42, which represents a 24% increase from where the shares last closed.

The launch’s commercial aspects in particular have attracted a great deal of attention when assessing Nuplazid, which includes “the payer response to Nuplazid’s higher than anticipated WAC cost.” Yet, Baral notes merely light payor pushback and elaborates, “Our KOLs largely seem to view the process for payor approval as worth the hassle given the potential benefit to their patients. We think this early response is encouraging, particularly given the high cost of Nuplazid.”

Ultimately, Baral remains bullish even in the midst of “a very mixed early clinical experience with Nuplazid” from PDP patient testimonies who revealed initial response rates that indicated a prospectively less efficacious profile than that of clinical trials. From Baral’s perspective, a better picture of both efficacy can be assessed by early 2017, after six to nine months following the launch have passed.

“Recent talks with Parkinson’s KOLs have confirmed our expectation of a slow but steady early launch for Nuplazid. Our consultants seem eager to trial the drug and report very minor payor pushback so far. Clinical experience with Nuplazid has been somewhat mixed, with varying reported response rates. We look forward to more clarity on commercial uptake and real world efficacy as the launch matures,” the analyst concludes.

As usual, we like to include the analyst’s track record when reporting on new analyst notes to give a perspective on the effect it has on stock performance. According to TipRanks, top five-star analyst Ritu Baral has achieved a high ranking of #51 out of 4,185 analysts. Baral upholds a 52% success rate and realizes 19.3% in her yearly returns. When recommending ACAD, Baral yields 3.5% in average profits on the stock.

TipRanks analytics demonstrate ACAD as a Strong Buy. Based on 8 analysts polled in the last 3 months, 7 rate a Buy on ACAD, while 1 maintains a Hold. The consensus price target stands at $47.14, marking a nearly 39% upside from where the stock is currently trading.

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