Ann: Q2 2024 update, page-53

Millionz, I think Kryptonite has made some valid observations that address your questions.

I’m not going to blame Acadia for setting its sales guidance expectations too high, given these are early days and there are so many unknowns. Early days following drug launch can be very “lumpy” and therefore difficult to accurately predict. Consequently, the share price can bounce around a lot. I’ve already experienced this with another biotech I hold.

I think there were two main factors that came into play with the negative market reaction to the Q2 sales announcement.

Acadia downgraded FY sales guidance for DayBue. The market will punish both downgraded and missed guidance severely. Even just meeting the low end of guidance gets punished.

DayBue sales for Q2 of US$84.6m missed the average analyst forecast of US$90m. If a company’s sales come in below average analyst forecast, it will get punished.

As for the differing reactions to Biogen (Skyclarys) and Acadia (DayBue)....

Biogen has 20 approved drugs; hence focus is less on Skyclarys and more on its new “big indication” drug, Lequembi, as well as overall sales.

Biogen’s guidance for FY2024 was limited to non-GAAP diluted EPS and that was revised upward from $15.00-$16.00 to $15.75-$16.25. Notably, no guidance (that I know of) was provided for FY 2024 SkyClarys sales so there was no guidance to miss, no expectations to disappoint. The market didn’t focus on the low growth in US sales of SkyClarys; instead it was focused on new European sales and the slightly upgraded overall EPS guidance.

In contrast, as it only has two marketed drugs, Acadia provides FY sales guidance for both.

Another thing to consider is that shorters are particularly fond of ACAD and are highly motivated to see the stock price go as low as possible.

As for what the analysts are saying about this week’s results – Needham, Cantor Fitzgerald and RBC Capital have maintained their rating on ACAD although RBC reduced its price target for ACAD from US$29.00 to US$26.00.

Leerink continues to rate ACAD an outperform, stating

Some investors may be disappointed by the lower Daybue sales guidance, but the new numbers appear credible given the lower discontinuations and improved new patient starts, and the stock was already discounting lower numbers.

https://www.investors.com/news/tech...rigal-intra-cellular-therapies-q2/?src=A00220

https://www.marketwatch.com/investing/stock/acad/analystestimates