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Axsome (AXSM) Soars on FDA Nod for Depression Drug, Auvelity

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Axsome Therapeutics, Inc. (AXSM - Free Report) announced that the FDA has approved Auvelity (dextromethorphan HBr -bupropion HCl) extended-release tablets for the treatment of adults with major depressive disorder (“MDD”). This marks the first FDA nod to the company for any of its pipeline candidates.

Per the company, following the FDA nod, Auvelity became the first and only rapid-acting oral medicine to be approved for the treatment of MDD with the labeling of statistically significant antidepressant efficacy versus placebo starting at week one.

Auvelity, an oral N-methyl D-aspartate receptor antagonist, uses the first new oral mechanism to be approved for treating MDD in more than 60 years.

AXSM plans to launch Auvelity in the fourth quarter of 2022 in the United States. The company is likely to generate revenues from the sale of the drug, thereafter.

Shares of Axsome surged 40.4% on Friday following the announcement of the news. The stock has rallied 57.6% this year against the industry’s decline of 20.6%.

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Auvelity (AXS-05) was evaluated across a comprehensive clinical program that studied patients with depression.

Data from the GEMINI study, which evaluated the efficacy of Auvelity in the treatment of MDD, showed that treatment with Auvelity led to statistically significantly superior improvement of depressive symptoms as measured by the change in the Montgomery-Åsberg Depression Rating Scale total score at Week 6 versus placebo – the primary endpoint. Auvelity treatment was also statistically significantly superior to bupropion sustained-release tablets 105 mg twice daily on the primary outcome measure in the ASCEND study.

Auvelity was granted Breakthrough Therapy designation for treating MDD by the FDA in 2019. The new drug application (NDA) for AXS-05 to treat MDD was under priority review. In June 2022, AXSM received the proposed labeling from the FDA for AXS-05.

Last August, the FDA identified deficiencies within the NDA for AXS-05 that precluded labeling discussions and extended the review period and delayed its potential approval. The FDA, however, did not ask for any additional information from the company then.

AXS-05 is also being developed for treating smoking cessation and agitation associated with Alzheimer's disease (AD).

Apart from AXS-05, Axsome’s key pipeline candidates include AXS-07, AXS-12 and AXS-14, which are currently being developed for multiple central nervous system indications.

Zacks Rank & Stocks to Consider

Axsome currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the biotech sector include Achilles Therapeutics plc (ACHL - Free Report) , Atara Biotherapeutics, Inc. (ATRA - Free Report) and ORIC Pharmaceuticals, Inc. (ORIC - Free Report) , all carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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