Acadia Pharmaceuticals (NASDAQ:ACAD) has been a huge winner so far in 2019. The biotech's Parkinson's disease psychosis (PDP) medicine Nuplazid (pimavanserin) has picked up significant sales momentum, and it's reported some positive clinical results.
The company announced its third-quarter results after the market closed on Wednesday. And Acadia had even more good news. Here are the highlights from the drugmaker's Q3 update.
By the numbers
Acadia reported that its revenue jumped 62% year over year in the third quarter to an all-time high of $94.6 million. This figure easily topped the Wall Street consensus revenue estimate of $88.5 million.
The company announced a net loss of $42 million, or $0.29 per share, based on generally accepted accounting principles (GAAP). This reflected an improvement from the GAAP net loss of $62.1 million, or $0.50 per share, recorded in the same period in 2018. It also came in better than the average analysts' net loss estimate of $0.40 per share.
Acadia ended the third quarter with cash, cash equivalents, and short-term investments of $683.8 million. This represented an increase from the $473.5 million on hand as of Dec. 31, 2018.
Behind the numbers
Sales for Acadia's one approved drug, Nuplazid, continued to soar in the third quarter, generating all of the company's revenue. Acadia enjoyed a boost from a favorable Medicare accrual adjustment, which added $2.2 million to its Q3 net sales.
Thanks to the sizzling momentum for Nuplazid, Acadia's bottom line trended in the right direction despite another quarterly loss. The company's operating expenses increased as well. However, Acadia was able to keep its spending growth rate to around 17%, well below its revenue growth rate.
The drugmaker's significantly better cash position at the end of the third quarter stemmed mainly from a public stock offering completed in September that generated net proceeds of $271.5 million. Acadia also benefited from employee option exercises totaling $55.1 million.
In addition to its solid financial performance in Q3, Acadia has several key developments on other fronts, including:
- Achieved the primary endpoint in Harmony phase 3 clinical study evaluating pimavanserin in dementia-related psychosis.
- Presented positive initial data from a phase 2 study evaluating pimavanserin as a monotherapy or as an adjunct therapy with selective serotonin reuptake inhibitor(SSRI) and serotonin and norepinephrine reuptake inhibitor (SNRI) in treating depressive symptoms.
- Kicked off the late-stage Lavendar clinical study evaluating trofinetide in treating Rett syndrome.
After its strong performance in Q3, Acadia now anticipates full-year 2019 revenue will be between $330 million and $340 million. That's up from the company's previous guidance of full-year revenue between $320 million and $330 million.
Perhaps the most important thing for investors to watch is Acadia's progress in winning U.S. Food and Drug Administration (FDA) approval for Nuplazid in treating dementia-related psychosis (DRP) after the stellar Harmony late-stage study results. Acadia CEO Steve Davis believes that Nuplazid "has the potential to be one of the first new treatments approved for people with dementia in over 15 years and the first-ever FDA-approved treatment for DRP."
However, biotech stocks tend to price in much of the potential for highly anticipated FDA approvals. That's the case with Acadia right now. This stock could move higher, though, and is one for investors to keep their eyes on.