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Axsome (AXSM) Q4 Earnings Miss, Auvelity Records First Sales
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Axsome Therapeutics, Inc. (AXSM - Free Report) incurred an adjusted loss of $1.28 per share in the fourth quarter of 2022, wider than the Zacks Consensus Estimate of a loss of $1.18. AXSM reported a loss of 90 cents per share in the year-ago period.
The company’s $24.4 million revenues beat the Zacks Consensus Estimate of $21.5 million. The revenues comprised sales of the sleep drug, Sunosi (solriamfetol) and the major depressive disorder drug, Auvelity. Axsome did not generate any revenue in the year-ago quarter due to the absence of a marketed product.
Auvelity (AXS-05), Axsome’s first approved drug, was approved by the FDA in August last year and launched in October 2022.
Axsome acquired the U.S. rights to Sunosi, a commercialized drug targeting narcolepsy, from Jazz Pharmaceuticals (JAZZ - Free Report) in May 2022. Axsome began selling Sunosi in the U.S. market in May 2022 and in certain international markets in November 2022.
In November, Axsome out-licensed its ex-U.S. marketing rights of Sunosi to Pharmanovia. Jazz received approval for Sunosi as a treatment for narcolepsy in 2019. JAZZ is entitled to receive high single-digit royalty on U.S. net sales of Sunosi.
Quarter in Detail
Auvelity sales in the fourth quarter were $5.2 million. Axsome has contacted the largest group purchasing organization (GPO) for the potential coverage of Auvelity. Pharmacy benefit managers and health plans are making coverage decisions for Auvelity under GPO.
Axsome’s shares were up almost 5% on Feb 27, probably as Auvelity sales beat investor expectations. Shares of Axsome have rallied 127.8% last year against the industry’s 11.8% decline.
Image Source: Zacks Investment Research
Research and development expenses were $14.7 million in the quarter, up 6.5% from the year-ago period’s level. This increase was due to higher costs associated with clinical studies and post-marketing commitments for Sunosi and Auvelity.
Selling, general and administrative expenses were $61.5 million, up 227% year over year. The significant increase was due to higher commercial activities for Sunosi and Auvelity, which included sales force onboarding and marketing spending.
As of Dec 31, 2022, Axsome had cash and cash equivalents worth $200.8 million compared with $227.5 million as on Sep 30, 2022.
Full-Year Results
Axsome generated revenues of $50 million in 2022 compared with zero revenues in 2021. The revenues reflect contributions from Axsome’s marketed drugs, Sunosi and Auvelity.
The company reported an adjusted loss of $4.42 per share for full-year 2022.
2023 Guidance
Management believes that its cash balance of 200.8 million (as of December 2022 end) and its $350 million term-loan facility will be enough to fund future operations into cash flow positivity.
The company also expects an increase in 2023 operating expenses on account of the commercialization activities of Sunosi and Auvelity and other pipeline development.
Pipeline Updates
Axsome’s key pipeline candidates, including AXS-05, AXS-07, AXS-12 and AXS-14, target multiple central nervous system indications.
Several label expansion studies on AXS-05 are currently underway for the treatment of other CNS disorders. Axsome is evaluating AXS-05 in a phase III study, ACCORD, for treating agitation associated with Alzheimer’s Disease (AD).
In November, Axsome announced positive results from the ACCORD study. The study met its primary and key secondary endpoints by substantially and statistically delaying the relapse time and preventing relapse of agitation symptoms compared to a placebo.
The company is also conducting the ADVANCE-2 study, a parallel group trial, to assess the efficacy and safety of AXS-05 for treating AD agitation. Axsome plans to complete patient enrollment by the first half of 2024.
Another lead candidate, AXS-07, is being developed for the acute treatment of migraine. In April 2022, Axsome received a complete response letter (CRL) for an NDA seeking approval for AXS-07 for the acute treatment of migraine.
Axsome intends to resubmit its NDA by the second half of 2023. The FDA has not requested any additional safety or efficacy data for the candidate in light of the NDA resubmission.
AXS-12 is being developed to treat narcolepsy, a sleep disorder characterized by excessive sleepiness. AXSM is currently enrolling patients in the phase III SYMPHONY study. Top-line data from this study is expected in the first half of 2023.
AXS-14 Solriamfetol is being developed for the treatment of ADHD and cognitive impairment. In October, the company announced that Solriamfetol met the primary endpoint in the SHARP study. This evaluated AXS-14 in cognitively impaired patients with excessive daytime sleepiness, associated with obstructive sleep apnea. The study also showed significant improvement in cognitive function in the above-mentioned patient group.
BeiGene’s loss per share estimates for 2023 has narrowed from $12.60 to $12.01 in the past 30 days. The stock has risen 2.4% in the past year.
BGNE's earnings missed estimates in three of the last four quarters and beat the mark once, the average negative surprise being 21.98%.
CRISPR Therapeutics' loss per share estimates for 2023 has narrowed from $8.21 to $7.53 in the past 30 days.
CRSP's earnings beat estimates in two of the last four quarters and missed the mark in the other two, the average surprise being 3.19%. The stock has fallen 19.9% in the past year.
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Axsome (AXSM) Q4 Earnings Miss, Auvelity Records First Sales
Axsome Therapeutics, Inc. (AXSM - Free Report) incurred an adjusted loss of $1.28 per share in the fourth quarter of 2022, wider than the Zacks Consensus Estimate of a loss of $1.18. AXSM reported a loss of 90 cents per share in the year-ago period.
The company’s $24.4 million revenues beat the Zacks Consensus Estimate of $21.5 million. The revenues comprised sales of the sleep drug, Sunosi (solriamfetol) and the major depressive disorder drug, Auvelity. Axsome did not generate any revenue in the year-ago quarter due to the absence of a marketed product.
Auvelity (AXS-05), Axsome’s first approved drug, was approved by the FDA in August last year and launched in October 2022.
Axsome acquired the U.S. rights to Sunosi, a commercialized drug targeting narcolepsy, from Jazz Pharmaceuticals (JAZZ - Free Report) in May 2022. Axsome began selling Sunosi in the U.S. market in May 2022 and in certain international markets in November 2022.
In November, Axsome out-licensed its ex-U.S. marketing rights of Sunosi to Pharmanovia. Jazz received approval for Sunosi as a treatment for narcolepsy in 2019. JAZZ is entitled to receive high single-digit royalty on U.S. net sales of Sunosi.
Quarter in Detail
Auvelity sales in the fourth quarter were $5.2 million. Axsome has contacted the largest group purchasing organization (GPO) for the potential coverage of Auvelity. Pharmacy benefit managers and health plans are making coverage decisions for Auvelity under GPO.
Axsome’s shares were up almost 5% on Feb 27, probably as Auvelity sales beat investor expectations. Shares of Axsome have rallied 127.8% last year against the industry’s 11.8% decline.
Image Source: Zacks Investment Research
Research and development expenses were $14.7 million in the quarter, up 6.5% from the year-ago period’s level. This increase was due to higher costs associated with clinical studies and post-marketing commitments for Sunosi and Auvelity.
Selling, general and administrative expenses were $61.5 million, up 227% year over year. The significant increase was due to higher commercial activities for Sunosi and Auvelity, which included sales force onboarding and marketing spending.
As of Dec 31, 2022, Axsome had cash and cash equivalents worth $200.8 million compared with $227.5 million as on Sep 30, 2022.
Full-Year Results
Axsome generated revenues of $50 million in 2022 compared with zero revenues in 2021. The revenues reflect contributions from Axsome’s marketed drugs, Sunosi and Auvelity.
The company reported an adjusted loss of $4.42 per share for full-year 2022.
2023 Guidance
Management believes that its cash balance of 200.8 million (as of December 2022 end) and its $350 million term-loan facility will be enough to fund future operations into cash flow positivity.
The company also expects an increase in 2023 operating expenses on account of the commercialization activities of Sunosi and Auvelity and other pipeline development.
Pipeline Updates
Axsome’s key pipeline candidates, including AXS-05, AXS-07, AXS-12 and AXS-14, target multiple central nervous system indications.
Several label expansion studies on AXS-05 are currently underway for the treatment of other CNS disorders. Axsome is evaluating AXS-05 in a phase III study, ACCORD, for treating agitation associated with Alzheimer’s Disease (AD).
In November, Axsome announced positive results from the ACCORD study. The study met its primary and key secondary endpoints by substantially and statistically delaying the relapse time and preventing relapse of agitation symptoms compared to a placebo.
The company is also conducting the ADVANCE-2 study, a parallel group trial, to assess the efficacy and safety of AXS-05 for treating AD agitation. Axsome plans to complete patient enrollment by the first half of 2024.
Another lead candidate, AXS-07, is being developed for the acute treatment of migraine. In April 2022, Axsome received a complete response letter (CRL) for an NDA seeking approval for AXS-07 for the acute treatment of migraine.
Axsome intends to resubmit its NDA by the second half of 2023. The FDA has not requested any additional safety or efficacy data for the candidate in light of the NDA resubmission.
AXS-12 is being developed to treat narcolepsy, a sleep disorder characterized by excessive sleepiness. AXSM is currently enrolling patients in the phase III SYMPHONY study. Top-line data from this study is expected in the first half of 2023.
AXS-14 Solriamfetol is being developed for the treatment of ADHD and cognitive impairment. In October, the company announced that Solriamfetol met the primary endpoint in the SHARP study. This evaluated AXS-14 in cognitively impaired patients with excessive daytime sleepiness, associated with obstructive sleep apnea. The study also showed significant improvement in cognitive function in the above-mentioned patient group.
Axsome Therapeutics, Inc. Price and Consensus
Axsome Therapeutics, Inc. price-consensus-chart | Axsome Therapeutics, Inc. Quote
Zacks Rank & Stocks to Consider
Currently, Axsome has a Zacks Rank #4 (Sell).
Some better-ranked stocks in the same sector include BeiGene (BGNE - Free Report) and CRISPR Therapeutics (CRSP - Free Report) , both holding a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
BeiGene’s loss per share estimates for 2023 has narrowed from $12.60 to $12.01 in the past 30 days. The stock has risen 2.4% in the past year.
BGNE's earnings missed estimates in three of the last four quarters and beat the mark once, the average negative surprise being 21.98%.
CRISPR Therapeutics' loss per share estimates for 2023 has narrowed from $8.21 to $7.53 in the past 30 days.
CRSP's earnings beat estimates in two of the last four quarters and missed the mark in the other two, the average surprise being 3.19%. The stock has fallen 19.9% in the past year.