Axsome Therapeutics Inc. (AXSM) is a name we started to follow just as the market was going over the falls in early 2025. As opposed to the market, the stock stayed down for months afterward. But after a lot of base-building, buyers have taken control and the growth and the story are as good as ever, advises Mike Cintolo, chief investment strategist at Cabot Wealth Network.
As opposed to many biotechs, Axsome isn’t just a one-drug outfit. It has three products on the market now and more to come.
Auvelity (for major depressive disorder) is the big draw these days, with sales up 69% in Q3. Management thinks peak sales could be $2 billion or so, about four times what it brings right now on a run-rate basis. Then there’s Sunosi for sleep apnea (sales up 35% last quarter) and Symbravo (acute migraines) that only recently hit the market. Each likely has peak sales potential near $400 million down the road.
Beyond that, there are two drugs that are likely to get FDA approval in 2026. One (AXS-12, targeting narcolepsy) looks like a $500 million opportunity. But the bigger one (AXS-05, for Alzheimer’s agitation) should have potential into the $1.5 billion range or more (approval seen likely in the first half of 2026). Axsome even has another drug in Phase III trials (for ADHD and other indications) that it thinks can be another $1 billion producer.
As for the here and now, sales growth is rapid (up 63% and 72% the past two quarters), with analysts looking for 50%-plus gains all of next year. The bottom line is still in the red. But that should change sometime in 2026 as business continues to ramp. Plus, sales should continue to grow rapidly for years to come even beyond this year.
As mentioned above, the stock etched a big launching pad, consolidating for about nine months in total. But it’s been acting much better since late September, with shares moving past their prior highs in late-2025. Near-term volatility is possible, but we think the path of least resistance is up – and approvals of the AXS drugs could provide an added tailwind.
Recommended Action: Buy AXSM.
