Player Avatar zzlangerhans (99.85) Submitted: 1/16/2011 3:37:52 PM : Underperform Start Price: $1.65 ACAD Score: +13.70

Back in June I green-thumbed Acadia as a potential cash play but wrote that I wouldn't consider a real buy until the share price dropped under 1. Sure enough the price dropped below 0.7 in December and I had them lined up for a 20000 share buy-in at 0.65.

Never happened. From December 16 to December 23 the stock doubled without any catalyst I could identify, and the share price recently hit 1.75 before pulling back slightly. The company wisely took advantage of the jump, which they possibly had manipulated themselves, with a 15M dilutive financing.

As far as I can tell, the only clinical trial in progress is a third phase III study of pimavanserin in Parkinson's psychosis. To recap, the first phase III trial was negative in 9/09, which decimated the share price. The second phase III trial was terminated short of completion after the company determined it was unlikely to succeed based on the results of the first trial. Topline data for the third phase III trial is not expected until mid-2012.

The market cap is now 64M with cash of 32M (probably closer to 42M on the next PR factoring in financing and burn) and a very questionable single-drug pipeline. I would expect the share price to pull back below 1 now that whatever sparked the share price double has dissipated. Of course, at some point before mid-2012 Acadia will have to be closely re-evaluated as a potential buy.

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