Acadia price falls 45% after the regulatory Update

Acadia Pharmaceuticals: Defect Found in Supplement

The health of a pharmaceutical company depends on the feedback of new drug candidates. A positive regulatory reaction almost always leads to a sharp rise in stock prices. Conversely, a refusal will force investors to the exit.

Unfortunately, for ACADIA Pharmaceuticals (ACAD), the company announced that the FDA had found a defect in a pimavanserin supplement marketed under the brand name Nuplazidine to treat hallucinations associated with dementia-linked Psychosis (DRP). The stock price fell 45% in the next session after the announcement.

The FDA has said it will discuss labeling and aftermarket requirements with the company, but it cannot do so until the company resolves the issue. The problem is that ACADIA has not yet explained the cause of the failure.

Analysts React to FDA Announcement

Mizuho analyst Vamil Divan said, “although the actual flaws do not appear to have been passed on to the company.” “We assume they will receive a letter with a full response to the request on April 3. Due to limited information, we are delaying the DRP launch for a year in our default scenario.”

The FDA has identified deficiencies preventing discussion of current labeling requirements/duties and aftermarket activities. The FDA said the announcement did not reflect the final decision on the information. However, this notice has not identified any FDA-identified defects and has not yet received a clear explanation from the FDA.