San Diego’s Acadia Pharmaceuticals (NASDAQ: ACAD) said today it has submitted its lead drug candidate for FDA approval. The company also said Steve Davis, who became interim CEO in March, will officially continue as the company’s president and CEO.
The company now appears to be back on track after stumbling almost six months ago.
Traders piled in, and Acadia shares jumped over 10 percent as the market opened. Acadia shares hit $42—$3.93 a share higher than yesterday’s close of $38.07. But the stock settled, and was trading above $39 by mid-day.
Davis, who joined Acadia as the chief financial officer just over a year ago, also joined the company’s board. He was previously the COO at Heron Therapeutics and Ardea Biosciences, and held a number of jobs a Neurogen.
Acadia is a biopharmaceutical company focused on developing small molecule drugs to address unmet medical needs in neurological diseases and disorders. Davis was named interim CEO on March 11, when longtime Acadia CEO Uli Hacksell unexpectedly retired, and the company pushed back its timetable for seeking FDA approval of pimavanserin (Nuplazid), a treatment for psychosis associated with Parkinson’s disease. Acadia shares plunged on the news.
At the time, Davis said Acadia’s new drug application (NDA) for pimavanserin would be pushed back to the second half of the year because the company could not scale up its quality assurance and manufacturing processes fast enough. As a result, Davis told analysts and investors in March that Acadia would not be ready for the FDA inspections that are part of the NDA review.
The company now appears to have addressed such problems. In a statement announcing its NDA filing, Acadia says it has asked the FDA for a priority review of the application. If the agency agrees—which it will decide after an initial 60-day review of the filing itself—the review process would be accelerated from 10 months to six months.
According to Acadia, its small-molecule drug “has demonstrated significant efficacy in Parkinson’s disease psychosis (PDP) and has the potential to avoid many of the debilitating side effects of existing antipsychotics, none of which are approved for use in PDP patients.”
The National Parkinson Foundation estimates that about 1 million Americans suffer from the debilitating neurological disease; about 40 percent of them are affected by Parkinson’s disease psychosis, in which patients experience hallucinations and delusions. There is currently no FDA-approved therapy for treating PDP, and the FDA has granted its “breakthrough therapy” designation for pimavanserin.
Because no treatments are available, analysts expect that Acadia’s drug could eventually reach annual sales of $2 billion or more if the company can win FDA approval.