Well, I don't think it predicts but looks like minimal resistance above $42.17- Need to get a better foot hold above that resistance. Too bad this Greece thing is going on.
So Greece sneezes and we get a cold. I really could care less if Greece shuts down their banks and their ATM machines are empty., to me this is not a failure of ACAD fundamentals. So perhaps its a buying opportunity, especially for newbies.
ACADIA Pharmaceuticals Is Poised To Outperform The IBB Moving Forward
Jun. 22, 2015 3:22 PM ET | 30 comments | About: ACADIA Pharmaceuticals Inc. (ACAD), Includes: IBB
Disclosure: I am/we are long ACAD. (More...)
ACAD is approaching its NDA for Nuplazid this year.
Nuplazid will be a blockbuster that's well beyond analyst expectations.
This unexpected success will drive future stock gains, and performance that exceeds the IBB.
There aren't too many ETFs that have outperformed the iShares Nasdaq Biotechnology ETF (NASDAQ:IBB) over the last couple of years. The rise of CAR-T technologies, the excitement with anti-PD1s in years past, and continued innovation in treating diseases like Multiple Sclerosis and Hep C have all been reasons for this performance. Many think the IBB is now in bubble territory, and that minimal insurance coverage upside and the ongoing likelihood of lower drug prices are not yet priced in. Regardless, one stock that has the potential to outperform the ETF in the next few years is ACADIA Pharmaceuticals (NASDAQ:ACAD).
It has been 20 months since I published my report on ACADIA Pharmaceuticals, and made a bold call that sales of its anti-psychotic drug Nuplazid could exceed $10 billion in the long term. Obviously, that's well above what most analysts have modeled, but as seen in my research, the figure is not random but rather figured from the drug's expected price point, its safety profile, the revenue of similar but less safe drugs, and the expected patient population size for both on and off-label indications. As a result, it's from this analysis and expectations that I derive my outlook for ACADIA Pharmaceuticals' stock.
That said, in looking back at the last 20 months, I am shocked that ACADIA Pharmaceuticals still has not submitted its New Drug Application for Nuplazid, and that its CEO abruptly resigned. This is a drug with a Breakthrough designation, showed a highly statistically significant benefit in reducing psychosis in Parkinson's disease patients, and perhaps most importantly is that there are no serious side effects associated with the drug (just minor headaches and such).
So, why is it now all of a sudden time to buy ACADIA Pharmaceuticals, and why will it outperform the IBB from this point forward? The answer lies in the realization of Nuplazid's commercial potential and the fact that ACADIA is finally about ready to submit its NDA. In other words, it's time to get moving in the right direction after well over a year of pre-NDA activities.
In retrospect, the fact that ACADIA Pharmaceuticals' stock has managed to hang with the IBB, despite a CEO resignation and well over a year of waiting for its NDA, is a testament to Wall Street's bullish outlook for the company. As I explained in my initial research, PDP is not Nuplazid's biggest indication. Most analysts expect $300 to $500 million in peak revenue from this indication; I expect at least $1.3 billion. The remainder of ACADIA Pharmaceuticals' peak revenue from Nuplazid will be achieved if FDA approves it to treat Alzheimer's disease psychosis and Schizophrenia (the former is very likely), and the rest from off-label use.
(click to enlarge)
Source: Acadia Pharmaceuticals
As a result, there is some risk that Nuplazid won't be FDA approved to treat other indications outside of PDP, but because of its safety profile, off-label usage is likely, as is an approval to treat Alzheimer's disease due to the similarities between it and PDP in how the two diseases are treated. That said, drugs like Abilify and Seroquel that have created billions in annual revenue at their peak were known for their off label appeal. Specifically, there are a lot of mental conditions with no approved drug, but patients who still need to be treated. That leads to off label use, and with Nuplazid's very rare safety profile, efficiency, Breakthrough designation, and the fact that it is the first drug to be proven effective at treating PDP, I expect it to be a favorite for off label use.
This all supports my assumption that revenue for Nuplazid can surpass several billion dollars in a relatively short period of time. Given that peak revenue for Nuplazid in treating PDP ranges from just $300-$500 million, investors can determine that ACADIA's current stock price is a reflection of those expectations, and that its 20% stock gains in the last three months are a reflection of its NDA date growing near. Further, ACADIA's stock during this period has significantly outperformed the IBB.
ACAD data by YCharts
With all things considered, if revenue for Nuplazid achieves closer to my estimates, there will be enormous stock gains for ACADIA. After large gains in the IBB, multiples in both biotechnology and large pharma have expanded considerably. It is not uncommon to see small and mid-cap biotechnology stocks trading at 9-15x sales, even larger companies like Biogen Idec (NASDAQ:BIIB), Bristol-Myers (NYSE:BMY), and Regeneron (NASDAQ:REGN) trade in the same range. Thus, in today's market, as crazy as it seems, a company like ACADIA Pharmaceuticals could very well support a market capitalization north of $10 billion on just $1 billion in trailing 12-month sales. After all, if ACADIA reaches such sales, or sales growth is faster than analysts expect, Nuplazid's outlook and ACADIA's market cap will be altered significantly.
With a $4 billion market capitalization right now, I foresee such gains over the next two years, gains that are tough to imagine in an overbought, overstretched ETF like the IBB. While ACADIA's cash & equivalents is less than $300 million, and ACADIA will need capital before the launch of Nuplazid, financing is a relatively small problem in comparison to the disconnect that Wall Street expectations are versus the likely monetization potential of Nuplazid. That's why I expect ACAD to be one of the better performing biotech stocks in the years to come, and I still believe that Nuplazid will prove to have been one of the most underrated blockbuster drugs in history.
First CEO news could bump us up some depending on who is selected. But if viewed as not favorable we could drop, eg, I am not sure about Davis-difficult to say how his selection would be viewed. For a NDA could be a major POP $5-10+- that is just a guess. Perhaps others here have more experience with that.
I have already sent them to the Iggy Basement- I put them on IGNORE over the weekend. Got the classical music on-Les Preludes- The Pastoral- Flower Duet...& coffee. Had a great Father's Day Dinner and went to the game and saw the Dodger's annihilate the Giants. Everyday is Saturday.
Yep, a Doji star formed, ( Evening Star Pattern - Up Trend Reversal Pattern) look at the candlestick chart. many times (not all) it is followed by a sell off. Thus it is a short term weakness . But ACAD has been very strong. Most of the computer generated candle interpretation must be "confirmed " ie by the next trading day. So I am not worried about it. If it drops its a buying op and may only last a short time. All stocks do this pattern during an Up Trend. Fundamentals are still great and candles don't take that into consideration.
Type Value Conf.
resist. 45.88 2
resist. 42.19 5
supp 40.34 9
supp 39.02 4
supp 38.21 4
supp 35.24 2
supp 34.76 2
supp 34.17 2
supp 30.98 2
supp 30.40 4
Recent CandleStick Analysis
Jun-19-2015 Bearish Doji Star
Ind. short Inter Long
EMA VBu VBu VBu
MACD VBu Bu VBu
Fibs Bu VBu Bu
Highs N N VBe
Lows N N N
Trends N VBu N
Analysis Overall Short Intermediate Long
Bullish (0.25) Neutral (-0.05) Very Bullish (0.50) Bullish (0.31)
....maybe that will get you moving.
BTW that is one of my favorite songs. Its simply beautiful. The story is that Sarah Brightman was asked to sing a "goodbye song " to introduce a famous fighter at his last fight, he was going to retire. She heard " Time to Say Goodbye" by Andrea Bocelli while having lunch and of course she loved it. So at the fight she was introduced and sung that song ...and the boxer cried. It was an amazing moment for the audience. Later the duet was recorded. Have a nice weekend.
What do they want in order to pay for it = Evidence that it works and provides the expected outcome. Basically, what I said. Now if there was evidence that it significantly improved your risk for Cardiovascular Disease and outcome then they pay for it and many other doctors would be obligated to use it as indicated. Otherwise, they are paying for a expensive Brand Name drug that has not been proven to have better outcome/efficacy than over the counter fish oil or other Cholesterol drugs . That's how it works. Evidence based medicine.
Don't get me wrong, ITI007 seems like a great drug with a great side effect profile, but the competition will be fierce. Thats why the follow up Head to Head study is really needed or be prepared for disappointment with the FDA or if it gets approved - poor sales. I mean look at ManKind, it shows despite a good drug and delivery system the stock has not delivered any kind of significant gains to the shareholders. Its "Dead Money."
This is not the time to go cheap on research evidence. Evidence based medicine has already taken hold and next is Value- Based Care- its coming and will affect every physician sooner or later. ..."Better care at a lower price ".
Who paid for the drug? What kind of drug was it, you don't have to say the specific name eg, was it blood thinner or cholesterol drug, heart/BP med etc.