I would seriously just ignore him. 5HT2a antagonists have been in the literature forever and inverse agonists are anything but new to the literature. Acadia clearly has a very strong patent position based on the chemical class on down. Eplivanserin (which he doesn't mention) was the Sanofi drug working as a 5HT2a inverse agonist for insomnia that was discontinued. Acadia would eat the lunch of either of these groups in my opinion which is why I believe no one is talking about patent issues. Acadia is very clearly in control here. Go away Doc....hype Belviq that doesn't even work. You have much more to worry about that patent issues....sales need to be your concern.
You're so wrong. Orphan drug status obviously adds to the underlying value of the program today. If we get positive trial results it's going to fly much higher with the orphan status in place.
I have been very quiet about Zalicus but I was a big follower of ziconotide over a decade ago. It goes without saying that positive data here turns Zalicus into an overnight sensation. Pain is a tough indication, but I like the experience of this team.
By the way, I was buying into the run today and was happy to do so. I became much more confident that a reverse split will not be needed. We'll see what happens next week, but I wouldn't be shocked to see it break above 1.00. On positive data Zalicus becomes a rocket.
The reason very likely comes down to the fact that they cannot attract appropriate institutional investors with the stock price under $5.00. agdp1981 is definitely right about that. I would also add that it's not going to hurt to tighten up the float. There are too many shares outstanding here. If they get positive Phase 2a results (in either trial) they will be able to raise funds on superior terms that what can be accomplished today. They definitely need to have fewer shares outstanding and a higher stock price before they can do a quality offering. I think this is exactly the right move for Zalicus at this time.
Nor do they understand the benefits of a $5+ stock price and a tighter float. I hear lots of investors say that Zalicus can be the next Acadia. Today was the first step if Zalicus wants to be taken seriously. You need better investors (no more small time manipulators) and that requires an appropriate stock price and a well controlled share float. Zalicus should become more attractive going forward because they're cleaning house. I bought in at .95 so for me this is a wash, but I was very conservative because I didn't like the huge float or low stock price. Cheap is fine as long as it doesn't mean being relegated to the world of penny stock manipulation. I missed Acadia's $1.50 to $5.00 but I was didn't miss a bit of the $5 to where it is today. Zalicus is looking good to me. All just my opinion, but don't shoot a company or its management team for doing what needs to be done before the next step(s) can be taken.
Baker Brothers may still be buying and there just are not that many shares out there left to buy. If no one is dumping then 5-8% isn't happening. We shall see. It recovered nicely today. I think most of the weak hands are gone at this stage. This stock clearly is being controlled by forces outside of the norm. All my opinion but it certainly seems like something big is brewing.
I know this won't be popular but I would like to see them announce positive Phase 2a results and then conduct a fund raising that brings in strong institutional holders for $7+ a share. I can't see them doing a round now as it's too close to data (unless they know they're sitting on positive results). We need to get the small funds out of this company and to replace them with stronger hands.
Exactly. That's what Acadia did before their run, it's what YM Biosciences did before they were bought. I like a lot of cash on the balance sheet because it enables a strong negotiating position. A potential partner (licensing or M&A) is going to show you much more respect if you have the cash to explore multiple options. This is actually a very strong management team so I'm not at all worried about their decisions. I was definitely in favor of this reverse split because it's impossible to attract quality funds when you're under $5.00. Bring on groups like Baker Brothers....get the quality into this company and the stock will perform remarkably upon positive results. This r/s was necessary and very expected. We're lucky we got the orphan drug run-up as it would have been more painful. That was the perfect time for this. I'm a longer term investor so I have no issue with what is happening and I've been in many good companies that have had to clean house before they could really prosper.
I agree that it's a healthy pullback, but Acadia trades in such an interesting way that it's hard to predict. The consolidation has been so steady and strong that big buyers may use today as a buying opportunity. We'll see but it just seems that there are powerful buyers at there very comfortable consolidating at this level. I too am a long term holder, but it just seems that there is more than meets the eye here. The trading isn't typical even for stocks that tend to rise quickly. Of course, it's because we're talking about the first time the FDA has ever waived off the need for a second Phase 3 and Pimavanserin will likely work in multiple indications based on its method of action. From PDP to ADP to schizophrenia and maybe even major depression, sleep disorders and bipolar. I think this is why it's running up so strong. The potential is too large.
I was in YM Bioscience before they were bought by Gilead for $500M based on their JAK. CTIC is extremely affordable considering that Pacritinib is in Phase 3 studies. YM wasn't even in Phase 3 when they were acquired so Pacritinib actually has more data and the drug profile of course suggests that it's going to be aimed at various cancers. The fact that Daniel Van Hoff heads up CTIC's SAB is enough reason to be excited. I personally see a partnership by year end and the news today just increases the potential size of that deal. Pfizer got their JAK (heavy at 3) to market for RA, Incyte got their JAK (mixed profile) to market for myelofibrosis and YM was bought out for $500M based on their JAK 2 (with emphasis at 1) to market for myelofibrosis. No JAKs are truly completely selective so that's all bogus talk. However, some are heavier at different areas than others and some do hit unique areas. The profile of Pacritinib is very unique suggesting efficacy and safety that perhaps we haven't seen before. Myelofibrosis is just the stepping stone to market...once there the indications will be expanded steadily. My opinion is that it's a very good company due to Pacritinib. YM was troubled before they acquired their candidate from Cytopia in Australia. A new drug can change everything. SB BIO was a solid company that ran out of resources. It's similar to what happened to Cytopia. I give Cell Therapeutics a lot of credit for being smart enough to chase down a really exciting drug candidate in this class. All my opinion and do your own DD.
Hmm, I posted a long message but I can't see it here. Maybe it's because I included a link. Anyway, I'll give a short summary of what I said. First, I said that I'm very interested in what you're putting together and hope to see it one day. I also said that I couldn't give a quantifiable model, but I could give a historical assessment. In 2011/12 the atypical antipsychotic market (in just the US I believe) was something like $12 billion. I've actually read higher numbers. Anyway, there are of course many atypicals and there is just one 5HT2a inverse agonist and that is of course pimavanserin (with no competition on the horizon). A novel antipsychotic should be able to treat conditions of psychosis such as PDP, ADP, schizophrenia, bipolar and major depression (where you may see these symptoms). On top of this, the profile is unique so you're going to find a lot of off-label and on-label use for other indications down the road. It may even end up playing a role in sleep disorders or levadopa-induced dyskinesias. Sky is the limit IMO...it reminds me of the atypicals. Anyway, the bottom line is that $12 billion a year for a company like Acadia is so hard to grasp but it's possible. I didn't say it would happen but it's possible because there is nothing else out there like pimavanserin. Certainly not that I know of anyway. The only companies working in CNS (without any solid data yet) that could even possibly compare would be what Targacept is working on. I would love to see Targacept get to where Acadia is, but they're just not in the same league. A second Phase 3 has never been called off in CNS before....that tells you all you need to know. The FDA isn't asking many more questions here....and I'm not either. What I'm holding I'm really holding and I'm not selling until the potential of Pimavanserin has been realized in an M&A or through actual sales. I can agree with those who don't want to see M&A, but in reality it may happen.
Well, there is no evidence they are dumping. However, to answer your question directly. They dumped all of their holding in YM Bioscience just before it was bought by Gilead by $500M. If you need Baker Bros to think for you then you need someone to manage your money for you. I like to think for myself and I did a 2x on YM while Baker broke even. I'm not calling Baker out...I love their trades. They're brilliant investors. My only point is that you need to think for yourself. I added today. I think the chances of being acquired have gone up. The price is much more reasonable now. Baker is also sitting on huge paper losses....an exit is going to seem appealing IMO.
Exactly. All I mean is that they're way down from where they were. Thanks for catching that. I think it's painful for anyone to look at their portfolio and see such a senseless loss overnight. People can claim that Acadia was overvalued and that it's all fluff, but they don't know the fundamentals at all. Large pharma knows the fundamentals and I believe the chances of a bid just went up dramatically. I know your take which is that it's worth much more longer term and I agree. It's just that they've become a bit more vulnerable to buyouts for the moment. At least that's what I believe, but others of course may completely disagree.
By the way, it's good to see you here. I think we lost a number of our long board members which is disappointing. It's always a shame when people talk about long term prospects and then dump after a hit. As far as we know, this is market reaction only. I am getting ready to add today. I have been hesitant but I think it's a good idea for me. I personally believe in the long term prospects even though I consider to believe that a buyout offer may be hard to resist. We will see. I won't mind being wrong if this ends up being a Celgene type company 5 years from now.
Well, you have to remember that I'm not day trading and am actually holding this longer term. My original cost basis was around $5 and I bought more at $12. My belief has always been that Acadia is a buyout candidate and my original target was $35/40. I started to revise that target higher when the stock ran really hard, but I'm now returning to that earlier view as my safety view. As far as I know, the fundamentals haven't changed. This is still the first CNS company to have a second Phase 3 waved off and the antipsychotic market is massive. I don't think pimavanserin needs to be as good as risperidone or zyprexa to be a blockbuster. It's the first improvement in almost two decades. It was 1994 when I was talking to professionals about risperidone. This is why I am buying. It has nothing to do with charts or baker brothers. It has to do with my own experiences and opinions which I definitely feel are my own. I think everyone should do their own DD and arrive at their own conclusions. My conclusions make me comfortable with Acadia. I think they have something very special. I have no idea what the price will do tomorrow, but I do believe a buyout would be significantly higher than where it is today.
As always, this is only my opinion. I'm here for the drug...I believe it's special. Perhaps others disagree, but to me it seems special.
Agree with that completely. It's an interesting point you raise. I have no way of knowing this, but I do believe large pharma has strong interest in Acadia and the story is advanced enough that some companies must be very familiar with the story. If a company has been looking seriously then why not plop an offer on the table when the price is reduced? If they were looking at $28/29 then they must be looking very seriously now. Acadia claims to not be interested in M&A, but I never believe management teams when it comes to that. Anyway, this is the first time that Acadia has been somewhat affordable for a pharmaceutical acquirer in my opinion. Now a $35 offer looks attractive, but on Monday it looked far too cheap. I'm not saying I think Acadia is worth only $35, but it doesn't actually matter what I think. Anyway, just my opinion and view. I personally don't discount the possibility of an unexpected catalyst before year end. It also may be that groups like Baker Bros become more receptive to such an offer now that they too are looking at gains that have been wiped out. That's not a nice feeling for anyone.
By the way, not sure how old other investors are but this has been one of the quickest bubble bursts I have ever seen because it is bio specific (to some extent) and somewhat Acadia specific in terms of severity. I wasn't going to be shocked if there was some negative news this morning, but nothing so far. I don't really care if two trials are required in the EU...I'm much more interested in the US market (for now). I do think starting the Alzheimer's study will help the stock price. I can't imagine what kind of negative news there could be which is why I'm hopeful that there isn't any. Anyway, the x factor here to me has always been large pharma and the need for small molecule oral therapeutic pipeline fillers that address blockbuster markets. Again, do your own DD and this is just my opinion. Good luck to everyone.
Any way to back the claim? I actually want you to be right because I think it's a good pick up for large pharma. The schizophrenia program is one of those high risk/high reward programs. Memory of course had one similar that failed. However, that program was a bit different. I like the Targacept candidate better and the trial design seems intelligent. I also like that they're going after urinary incontinence. That's a solid target. We also have the Alzheimer's program. Honestly speaking, the cash and platform alone may bring $10 per share. I hope there are contingencies at that level so we get upside in the event schiz, uc or alzheimer's pan out. This is a relatively safe pick-up for a CNS company looking to take a gamble. You get the cash, platform and several shots on goal. AstraZeneca is obviously not a candidate, but perhaps there is a group out there. I'd like that deal as I have a lot of this stock (at a good price) but wouldn't mind an exit at this stage.