By Colin Kellaher

 

Shares of Acadia Pharmaceuticals Inc. lost a third of their value and hit a new 52-week low after the latest setback in the pharmaceutical company's efforts to win expanded U.S. Food and Drug Administration approval for its Nuplazid antipsychotic drug.

Acadia late Friday said an FDA advisory committee voted 9-to-3 that the evidence presented doesn't support a conclusion that Nuplazid is effective for the treatment of hallucinations and delusions associated with Alzheimer's disease psychosis.

Nuplazid has been approved in the U.S. since 2016 to treat hallucinations and delusions associated with Parkinson's disease psychosis, and the FDA is weighing Acadia's request for expanded use in patients with Alzheimer's, with a decision expected by Aug. 4.

Wall Street analysts in general believe that the advisory committee vote means the FDA will once again reject the application.

Acadia in 2020 filed for FDA approval of Nuplazid to treat hallucinations and delusions associated with dementia-related psychosis, but the agency turned the application away in April 2021, citing, among other things, a lack of statistical significance in some of the subgroups of dementia.

The company resubmitted its application in February of this year, this time seeking approval in patients with Alzheimer's disease.

Acadia said it is disappointed with the vote, and that it believes there is substantial evidence across multiple independent clinical studies and endpoints that supports the efficacy of Nuplazid in Alzheimer's disease psychosis.

The FDA isn't required to follow the advice of its advisory committees, but it usually does, and analysts at Mizuho Securities said in a research note that they expect the agency will once again reject Acadia's application and request another study.

The negative advisory committee vote prompted several Wall Street firms to cut their price targets on Acadia shares, as many now expect the FDA to issue a so-called complete response letter, or CRL, by Aug. 4, indicating that the agency won't approve the application in its current form.

On a potentially positive note, Citi analyst Neena Bitritto-Garg said a CRL could make Acadia a potential takeover target for biopharmaceutical companies looking to boost their revenue. Nuplazid sales exceeded $480 million last year, and the company has forecast 2022 sales of $510 million to $560 million.

Acadia shares were recently changing hands at $12.64, down 35.2%, after hitting a 52-week low of $12.24 earlier in the session.

 

Write to Colin Kellaher at colin.kellaher@wsj.com

 

(END) Dow Jones Newswires

June 21, 2022 11:16 ET (15:16 GMT)

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