As regards indications for Pimavanserin beyond Parkinson’s & Alzheimer’s, there's really only 1 other plausible candidate - as an add-on therapy to established schizophrenia drugs. Acadia have carried out 3 Phase IIa trials here which reported results in 2004, 2005 & 2007. All 3 trials were relatively successful. The demonstrated add-on benefits were pretty useful:
* Reduced the schizophrenia drug dosage by 2/3rds
* Eliminated a nasty side effect called akathasia (which gives patients feelings of anxiety, physical restlessness & sometimes even extreme feelings of terror/doom)
* Faster onset of action
There’s also been a Phase IIa trial for sleep maintenance insomnia which reported in 2006. This also got decent results but insomnia is a very crowded indication for drug development. I would discount this particular indication completely.
However, there’s been no activity on these other indications for more than 2 years. Acadia management clearly believe Parkinson’s is the value-creating indication. In addition, an add-on therapy is rarely a lucrative one – they seem to be more about extending out patent lifespans in practice.
On the PPS, if the Parkinson’s Phase III trial is a success then I think $8 is a full price. This reflects it being only a $200m indication in North America.
However, in my view, Alzheimer’s is the diamond-encrusted platinum lining. The market is 5 times that of Parkinson’s, there’s patent exclusivity to 2021 & (critically) there’s no competing drug in Phase II or Phase III development (which is bizarre given there’s 400+ active trials for Alzheimers’ indications). If they were successful here, then I think a $24 price is very plausible using a realistic DCF valuation.
Also, there’s a good logic as to why Pimavanserin would work in Alzheimers. The damage caused to the brain by Alzheimer’s leads it to rely more on dopamine-related pathways to function. However, these pathways can overload which causes the psychosis. Existing anti-psychotics help with the psychosis but also turn off dopamine. Then (out of the frying pan & into the fire) the brain isn’t left with much to work with & cognitive decline accelerates. However, Pimavanserin’s unique differentiator is it doesn’t turn off dopamine but yet has good anti-psychotic efficacy.
My dream scenario is for the Parkinson’s Phase III to be successful but also for Acadia/Biovail to spell out – on the same day - a clear development plan for the Alzheimer’s indication. This could credibly push the price up to $12-$15 in the short-term. It should also accelerate a European licence deal – my guess is to Lundbeck whose impressive mental illness franchise is facing a patent expiry cliff.
Bear in mind ongoing recognition in the PPS for Alzheimer’s development should be relatively quick. Cognitive related Alzheimer’s drug trials need 2 years of treatment to demonstrate efficacy. However, psychosis trials need 4-6 weeks to demonstrate efficacy.
P.S. Could someone explain to me how my recent previous posting appears to have been deleted from this board?
Agree with everything you've said. Would just like to add that if this medication when used as adjunctive treatment for schizophrenia could show reduced side effects like akathasia and the dreaded development of tardive dyskinesia, as well as less dry mouth and other side effects caused by the cogentin type drugs this could be a huge winner just on that. What I believe is the FDA is going to be looking at in the future for any antipychotic drugs will going back to square one in medicine. That being "do no harm." Unfortunately this population by current studies die at a much younger age than the general population. Some of of that being from the weight gain associated with antipyschotic drugs that causes associated increased probability for developing diabetes mellitus and everything that is associated with SyndromeX/Dysmetabolic Syndrome. Thus if you need less antipyschotic medication per patient most probably you will suffer less weight gain and that should decrease your risk of cardiovascular disease and thus hit hard endpoints of less MI, and less CVA, and prolonged life. Small amounts of improvement in large populations spells tremendous success. By just raising a large populations systolic blood pressure by 2 points can cause enough worsening in that populations CV risk profile to do a drug in. PFE knows that with their HDL augmentor that eventually failed. Also, the FDA seems to me to be also looking into subjective symptoms, improvement by the patients on medication in regards to quality of life as they see it. Thus that would obviously bode well for this drug in that newly important area from the FDA if those aforementioned side effects could be reduced.
The same idea can be used to convey the potential for the use in Alzheimer's disease. I believe that AD treatment in the future will incorporate many meds being used at one time, like congestive heart failure is treated now, once more is understood about the disease. Cost for a nursing home is about $300 per day. Anyway you can keep the person home longer without having to go to the nursing home makes these drugs all the more attractive. The combo of an actelycholinesterase inhibitor and glutamate inhibitor is very helpful now but there is always room for additive improvement.
This company does look attractive to me as far as risk/reward is concerned. t
There's something fishy going on with the deletion of positive posts all over Yahoo. I suspect that the Shorts have found a way to delete any message harmful to them almost immediately. Could be serious.
On the other hand it validifies that your messages carry weight!
Your going to need to explain your depression play again. I don't see how a drug built to stop people brains from deteriorating is a depression play. I could see it being used for MS or another condition where the brain is shown to be suffering from an unexplained trauma but depression seems like a stretch. Most of the time depression is brought on by an event (divorce, mid life crisis) and the brain works fine. Maybe there is something I'm missing.