An FDA advisory panel announced a negative outcome for Acadia's antipsychotic drug
Acadia Pharmaceuticals Inc (NASDAQ:ACAD) stock is one of the worst stocks on the Nasdaq today, down 35.6% to trade at $12.56 at last check. On Friday, the U.S. Food and Drug Administration (FDA) advisory panel voted 9-3 that the biopharmaceutical name's antipsychotic drug, Nuplazid (pimavanserin), which is used to treat psychosis related to Alzheimer's, is not an effective treatment. Since this decision, analysts have been overwhelmingly negative, with the general consensus being that it is unlikely the FDA will approve the drug in August.
After the news, J.P. Morgan Securities downgraded ACAD to "neutral" from "overweight," while Jefferies cut its rating to "underperform" from "buy." No fewer than four other analysts slashed their price targets as well, though the 12-month consensus price target of $25.94 is still a 107% premium to current levels.
This negative price action has ACAD crumbling to a nine-year bottom, earlier trading as low as $12.24 and falling on the Short Sale Restricted (SSR) list. Year-to-date, the equity is now down 45.7%.
Options traders are eyeing the stock, too, with volume running at four times what's typically seen at this point. The weekly 6/24 16-strike put is the most popular by far, with new positions being opened at the weekly 6/24 17-strike call.