Top Picks 2016: Acadia Pharmaceuticals

01/27/2016 7:00 am EST

Focus: HEALTHCARE

John McCamant

Editor, Medical Technology Stock Letter

Our Top Pick for speculative investors is a biotech firm that is poised for a strong 2016 with a string of positive catalysts lined up for Nuplazid, a wholly-owned asset, explains John McCamant, editor of The Medical Technology Stock Letter.

Nuplazid, the lead drug candidate from Acadia Pharmaceuticals (ACAD), has successfully completed Phase III trials to treat Parkinson's Disease psychosis (PDP).

The FDA recently accepted its new drug application (NDA) for the drug and importantly granted the compound Priority Review, cutting the review timeline to just six months.

The FDA PDUFA date is set for May 1, setting up a transformational year for ACAD in 2016.

With the NDA now filed and PDUFA date on the calendar, ACAD has shifted gears and is currently in full commercial launch mode with preparation progressing as planned.

The company is building a sales force of 135 reps, who will be trained and ready for a mid-year launch.

Additionally, ACAD is growing its senior level commercial team and has hired key medical affairs personnel. In fact, early feedback from the PDP disease awareness education program has been encouraging.

2016 sets up as juggernaut year of high impact events for ACAD including US approval and commercial launch of Nuplazid.

Filing the MAA for marketing approval in the EU; ex-US commercialization rights deal(s) and the topline data read out of the Phase II Alzheimer's Disease dementia trial.

While M&A is impossible to predict, ACAD does have a wholly-owned de-risked drug about to be approved addressing what we believe is a billion-dollar market or more, making it a logical takeout candidate. ACAD is buy under $40 with a target price of $55.

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