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Axsome (AXSM) Stock Up 17% in Six Months: Here's Why

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Shares of Axsome (AXSM - Free Report) have surged 17.2% in the past six months against the industry's 0.4% decline.

Zacks Investment Research
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The upside can be attributed to FDA’s approval for Auvelity (“AXS-05”), for treating major depressive disorder, the addition of Sunosi to its marketed portfolio and rapid progress of its pipeline of central nervous system (CNS) disorder candidates.

Auvelity was approved by FDA in August 2022 and launched in October.

The drug had an encouraging early launch, with a sales of $5.2 million in the fourth quarter of 2022. Earlier this year, Axsome contacted the largest group purchasing organization (GPO) for the potential commercial coverage of Auvelity. Pharmacy benefit managers and health plans are making coverage decisions for the drug under GPO. 

AXS-05 is also being developed for other indications like Alzheimer's disease agitation as well as an aid to smoking cessation. 

Investors should focus on the sales of Sunosi, a commercialized drug targeting narcolepsy, showing steady growth both in the United States and overseas. 

Axsome acquired the U.S. and ex-U.S. rights to Sunosi from Jazz Pharmaceuticals in May 2022 and November 2022, respectively.

In February, the company out-licensed its European and certain MENA countries' commercial rights of Sunosi to Pharmanovia. In consideration, Axsome received an upfront payment of $66 million with potential milestones up to $101 million. The U.S. prescriptions for Sunosi showed strong growth, with an increase of 21% in 2022 from the previous year.

Axsome has other impressive pipeline candidates, including AXS-07, AXS-12 and AXS-14, which target multiple CNS indications.

AXS-07 is developed for the acute treatment of migraine. The company has completed two phase III studies of AXS-07 and achieved co-primary endpoints in both the studies. In April 2022, the FDA issued a complete response letter (CRL) for NDA filed for AXS-07. It intends to resubmit its NDA by the second half of 2023.

AXS-12 is being developed to treat narcolepsy, and AXS-14 (Solriamfetol) for treating ADHD and cognitive impairment.

 

Zacks Rank & Stocks to Consider                                                                    

Currently, Axsome has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the same sector are Certera (CERT - Free Report) , Kala Pharmaceuticals (KALA - Free Report) and Jasper Therapeutics (JSPR - Free Report) . Certera sports a Zack Rank #1 (Strong Buy), whereas Kala Pharmaceuticals and Jasper Therapeutics each holds a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Certera's earnings per share (EPS) estimates have widened from 46 cents to $1.24 for 2023 and from 55 cents to $1.85 for 2024, in the past 60 days. The stock has gained 69.5% in the past six months.

CERT’s earnings beat estimates in one of the last four quarters, missed the mark in two and met the same in another, the average negative surprise being 3.25%.

Kala Pharmaceuticals’ loss per share estimates have narrowed from $19.67 to $15.35 for 2023 and from $14.41 to $13.12 for 2024, in the past 60 days. The stock has plunged 4.2% in the past six months.

KALA’s earnings beat estimates in two of the last four quarters and missed the mark in the other two, the average surprise being 11.56%.

Jasper therapeutics’ loss per share estimates have narrowed from $1.42 to 61 cents for 2023 and from $1.6 to 59 cents for 2024, in the past 60 days. The stock has surged 87% in the past six months.

JSPR’s earnings beat estimates in three of the last four quarters and met the mark in one, the average surprise being 3.51%.


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