On Tuesday, Acadia Pharmaceuticals dropped out of two conferences and its stock price jumped, apparently because investors thought an acquisition was coming.
Not quite. Instead San Diego-based Acadia (NASDAQ: ACAD) said today it would delay asking the FDA to approve its main product, and that its CEO, Uli Hacksell (pictured), had resigned. Acadia shares fell more than 22 percent in after-hours trading when the news broke. Shares had closed at $44.76 apiece just minutes prior.
Acadia’s lead drug is pimavanserin (Nuplazid), a treatment for the psychosis associated with Parkinson’s disease. All seemed on track on its earnings report call in late February, with an FDA submission—known as a new drug application, or NDA—of pimavanserin expected by the end of March.
Interim CEO Steve Davis, who is also the chief financial officer, said today on a conference call that Acadia is pushing back its NDA filing until the second half of 2015 because it could not scale up its quality assurance and manufacturing processes fast enough, and would not be ready for the FDA inspections that go along with the approval review.
Davis and other executives on the call were adamant that there have been no problems with the drug itself. Pimavanserin is a small molecule—in other words, a relatively straightforward chemical product to make, unlike some biopharma products made from proteins and grown in living cells. “This has nothing to do with the formulation or the synthesis of the drug,” Davis said, and that the problems, once ironed out, shouldn’t “limit the approval of the drug once [we] have those systems in place.”
So what exactly happened? Davis and colleagues wouldn’t say which quality control, supply chain, or manufacturing problems forced the delay, but Hacksell is the fall guy. (Davis said the company made “senior management changes” as part of the fix, and has hired both “management consultants” and “in-house experts,” but Hacksell’s was the only departure discussed or disclosed.)
“Mistakes were made,” Davis said. “The company should have been better prepared.”
Hacksell is also leaving the Acadia board of directors. It is not clear if he resigned voluntarily or was voted out. His departure does not mean Acadia wants to change its broader strategy “at all,” Davis said.
Hacksell is getting some cash on the way out the door, however. Regulatory filings show he’ll be a consultant for Acadia for 18 months and release the company from any potential legal claims. In return, he’ll get a total of $616,000 in payments.
The company still plans to launch pimavanserin independently in the U.S. and will keep its options open whether to launch outside the U.S. with a partner, Davis said.