A Second Look: Acadia Pharma
Associated Press 03.20.07, 11:18 AM ET
Shares of Acadia Pharmaceuticals Inc. retreated Tuesday morning, a day after the company's stock price more than doubled on positive results from a schizophrenia drug trial.
On Monday, the San Diego-based company said ACP-103 achieved a statistically significant level of effectiveness in a Phase II trial, reducing the effects of schizophrenia when used with anti-psychotic drugs haloperidol and risperidone.
Schizophrenia is a chronic, debilitating mental illness characterized by disturbances in thinking, emotional reaction and behavior.
Banc of America Securities analyst William Ho reiterated his "Buy" rating for the stock, and increased his price target to $24.50 from $10. That implies upside of 80 percent over the stock's closing price Monday of $13.61 on the Nasdaq Stock Market.
"We believe that Acadia has an emerging pipeline with five promising clinical programs targeting large central nervous system markets such as schizophrenia, Parkinson's disease and sleep maintenance insomnia," Ho said. "We believe over the long term Acadia's pipeline of products will create value for shareholders," he added.
Ho said Acadia will seek a partner before the drug goes to a Phase III trial, and Eli Lilly & Co. may be that partner. Lilly's patent on its schizophrenia treatment, Zyprexa, will expire in October 2011, he said, and Zyprexa's market share is limited because of its weight gain side effect.
Acadia also said ACP-103 combined with risperidone causes 50 percent less weight gain than risperidone alone.
Acadia stock fell 64 cents, or 4.7 percent, to $12.97 in morning trading on the Nasdaq Stock Market. On Monday, shares - which have traded between $5.07 and $16.45 in the past year - ballooned to $13.61 from $6.69.
Shares of Eli Lilly gave up 24 cents, to $52.44 on the New York Stock Exchange. |
