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ACADIA (ACAD) Q4 Earnings Surpass, Nuplazid Drives Sales

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ACADIA Pharmaceuticals Inc. ACAD reported fourth-quarter 2019 loss of 34 cents per share, narrower than the Zacks Consensus Estimate of a loss of 37 cents as well as the year-ago loss of 50 cents.

Total revenues comprising net sales of the sole marketed drug Nuplazid (pimavanserin) soared 65% year over year to $98.3 million in the fourth quarter. The top line also surpassed the Zacks Consensus Estimate of $96 million.

Notably, Nuplazid is the first and the only FDA-approved treatment for hallucinations and delusions associated with Parkinson’s disease psychosis. Several additional studies on Nuplazid targeting different central nervous system (CNS) indications are currently underway.

Shares of ACADIA were up 3.8% in after-hours trading on Wednesday following announcement of better-than-expected results. In fact, the stock has rallied 51.8% in the past year against the industry’s decrease of 8.8%.

Sales of Nuplazid have grown steadily both year over year and sequentially. The drug has seen a strong uptake ever since its launch in 2016. On fourth-quarter conference call, management stated that the number of patients being treated with Nuplazid continues to grow. Demand for the drug remains strong across both the specialty pharmacy and the specialty distribution channels.

Research and development (R&D) expenses were $57.5 million in the quarter, up 19.3% from the year-ago period due to higher development costs related to the company’s pipeline candidate trofinetide and label expansion studies on Nuplazid.

Selling, general and administrative (SG&A) expenses rose 23.7% year over year to $91.9 million due to increased marketing expense and higher advertising and personnel costs.

As of Dec31, 2019, ACADIA had cash, cash equivalents and investments of $697.4 million compared with $683.8 million as of Sep 30, 2019.

Full-Year Results

For 2019, ACADIA’s revenues of $339.1 million were up 52% year over year.

Loss per share was $1.60 in 2019 compared with the loss of $1.94 in 2018.

Pipeline Updates

Nuplazid is being evaluated in the phase III HARMONY study for treating dementia-related psychosis (DRP). Other studies include the phase II ADVANCE study for addressing schizophrenia’s negative symptoms and the phase III CLARITY study as an adjunctive treatment of major depressive disorder (MDD).

ACADIA is planning to file a supplemental new drug application seeking approval of Nupalzid to treat DRP later in the summer of 2020.

The company plans to initiate a second pivotal study, ADVANCE-2, on Nupalzid later in 2020 for treating negative symptoms of schizophrenia. Per the company, this is a potential fourth indication for Nupalzid while MDD is a potential third indication for Nupalzid.

Apart from Nupalzid, ACADIA is evaluating its investigational candidate trofinetide in a late-stage study for the treatment of Rett syndrome, a rare neurodevelopmental congenital CNS disorder for girls aged between five and 20 years. In October 2019, the company initiated the phase III LAVENDER study on trofinetide for addressing the same indication. Top-line results from the same are expected next year.

2020 Guidance

ACADIA expects total revenues in the range of $440-$470 million for the full year. The Zacks Consensus Estimate for the metric stands at $448.9 million for the period.

ACADIA Pharmaceuticals Inc. Price, Consensus and EPS Surprise

Zacks Rank & Stocks to Consider

ACADIA currently carries a Zacks Rank #4 (Sell).

Better-ranked stocks in the biotech sector include Regeneron Pharmaceuticals, Inc. REGN, Agenus Inc. AGEN and Aduro Biotech, Inc. ADRO, all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Regeneron’s earnings estimates have been revised 5.8% upward for 2020 over the past 60 days. The stock has gained 6.3% in the past year.

Agenus’ loss per share estimates have been narrowed 8.8% for 2020 over the past 60 days.

Aduro’s loss per share estimates have been narrowed 10.5% for 2020 over the past 60 days.

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