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Axsome's (AXSM) Earnings Miss in Q1, Pipeline Progresses

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Axsome Therapeutics, Inc. (AXSM - Free Report) reported first-quarter 2020 loss per share of 88 cents, wider than the Zacks Consensus Estimate of a loss of 60 cents and also the year ago quarter’s loss of 32 cents.

Axsome currently does not have any approved product in its portfolio. As a result, the company is yet to generate any revenues from the same.

Shares of Axsome have declined 14.9% in the year so far against the industry’s increase of 5.2%.


Quarter in Detail

Research and development (R&D) expenses were $27.5 million in the quarter, significantly higher than $7.6 million in the year-ago period due to escalated development costs of two advanced pipeline candidates, namely AXS-05 and AXS-07.

General and administrative (G&A) expenses were $5 million, up 78.5% year over year due to increased stock compensation expenses and higher personnel costs.

As of Mar 31 2020, Axsome had cash worth $$197.3 million compared with $220 million as of Dec 31, 2019. Axsome believes that its cash balance as of March-end will be enough to fund anticipated operations for at least a couple of years.

Pipeline Update

Axsome’s central nervous system (CNS) pipeline candidates including AXS-05, AXS-07, AXS-09, AXS-12 and AXS-14 are currently being developed for multiple indications.

AXS-05 is being developed for treating major depressive disorder (MDD), treatment-resistant depression (TRD) and agitation associated with Alzheimer's disease (AD).

Per data announced in December 2019, AXS-05 met the primary endpoint and significantly improved symptoms of depression in the phase III GEMINI study on MDD. Axsome plans to submit a new drug application (NDA) for AXS-05 in the fourth quarter of 2020 to treat MDD.

Notably, in April 2020, the company announced positive top-line data from the phase II/III ADVANCE-1 study on AXS-05 for treating agitation associated with AD. The candidate met the primary endpoint and rapidly, substantially and significantly improved agitation in patients with Alzheimer’s disease as compared to placebo. The company will begin a phase III study on the same in the second half of 2020.

Axsome also aims to initiate a second phase III study on AXS-05 in the third quarter of 2020 for addressing patients with TRD.

Meanwhile, Axsome is evaluating AXS-07 in the phase III MOMENTUM study as an acute treatment of migraine and in the phase III INTERCEPT study as an early treatment of migraine.

Last month, AXS-07 met two regulatory co-primary endpoints in the phase III INTERCEPT study that evaluated the candidate for early treatment of migraine. The co-primary goals were freedom from migraine pain and freedom from most bothersome symptoms compared to placebo in the study.

We remind investors that last December, AXS-07 met the two regulatory co-primary endpoints in the phase III MOMENTUM study evaluating the same for acute treatment of migraine. Axsome plans to file a NDA for AXS-07 to the FDA in the fourth quarter of 2020 for the given indication.

Axsome Therapeutics Inc Price, Consensus and EPS Surprise

Zacks Rank & Stocks to Consider

Axsome currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the healthcare sector include Menlo Therapeutics Inc. , Celsion Corporation and Abeona Therapeutics Inc , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Menlo Therapeutics’ loss per share estimates have narrowed 28% for 2020 and 50% for 2021 over the past 60 days.

Celsion’s loss per share estimates have narrowed 11.3% for 2020 and 15.2% for 2021 over the past 60 days.

Abeona Therapeutics’ loss per share estimates have narrowed 14.5% for 2020 and 14.5% for 2021 over the past 60 days.

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