Axsome Therapeutics, Inc.
AXSM
announced that it has received post-marketing requirements/commitments proposed by the FDA related to its new drug application (“NDA”) seeking approval for one of its lead candidates, AXS-05. The company has also agreed to the FDA’s proposal.
The NDA is seeking approval for AXS-05 as a potential treatment for major depressive disorder (“MDD”). Following this new regulatory update related to the AXS-05 NDA, the company believes that the FDA may provide a decision during the second quarter.
Axsome’s shares gained 25.1% on Apr 19, following the receipt of proposed post-marketing requirements/commitments from the FDA. In fact, shares of Axsome have gained 8.3% so far this year against the
industry
’s decline of 15.6%.
Image Source: Zacks Investment Research
Axsome filed the NDA for AXS-05 in 2021, which was granted priority review by the FDA. A decision was previously expected in August 2021. However, the FDA extended the review period for the NDA in August last year, citing deficiencies within the NDA that preclude labeling discussions, including deficiencies related to analytical methods in the chemistry, manufacturing, and controls section of the NDA. The regulatory authority informed the company that it will not be able to take action related to the NDA until the deficiencies are addressed.
On its fourth-quarter earnings call, Axsome stated that it has already submitted a response to these deficiencies, which have been duly received by the FDA. AXSM stated that the responses filed by it are not major amendments to the NDA.
Investors cheered the recent update from the FDA amid uncertainty related to the review timeline for the AXS-05 NDA for MDD. A potential approval will lead to the first commercialized product for Axsome.
The company has been actively engaged in preparing for the commercial launch of AXS-05 targeting MDD patients in the past few months regardless of the extension of the review timeline for its NDA.
Apart from MDD, Axsome is also developing AXS-05 for treating treatment-resistant depression (“TRD”), smoking cessation and agitation associated with Alzheimer’s disease (“AD”). The company is currently enrolling patients in the phase III ACCORD study, which is evaluating the safety and efficacy of AXS-05 for treating agitation associated with AD. It plans to start a pivotal phase II/III study for AXS-05 as a potential treatment for smoking cessation. The timing of the initiation will be informed later this year.
In a bid to strengthen its portfolio, Axsome signed an
agreement
with
Jazz Pharmaceuticals
JAZZ
last month to acquire the latter’s new sleep drug, Sunosi.
Jazz has received approval for Sunosi as a treatment to improve wakefulness and reduce excessive daytime sleepiness in adults with narcolepsy or obstructive sleep apnea. Jazz currently commercializes Sunosi in the United States, Europe and several other countries.
Zacks Rank & Stocks to Consider
Axsome currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the biotech sector are
Axcella Health
AXLA
and
Trevi Therapeutics
TRVI
, both carrying a Zacks Rank #2 (Buy) at present. You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
The Zacks Consensus Estimate for Axcella Health’s 2022 and 2023 loss has narrowed 12.9% and 16.4%, respectively, over the past 60 days. AXLA has declined 6.2% so far this year.
Earnings of Axcella Health surpassed estimates in three of the trailing four quarters and missed once, the average beat being 1.67%.
The consensus estimate for Trevi’s 2022 bottom line has narrowed 19.4% for 2022 and 14.1% for 2023 over the past 60 days. The stock has surged 328.3% so far this year.
Earnings of Trevi surpassed estimates in two of the trailing four quarters and missed the same on the other two occasions, the average beat being 5.09%.
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