We maintain our OVERWEIGHT on Neuren with an upgraded risked PT...

We maintain our OVERWEIGHT on Neuren with an upgraded risked PT of $22.32/sh. Acadia are now the sole owners of global rights to trofinetide (now marketed as DAYBUE in the US), and have future optionality to develop Neuren’s second asset, NNZ-2591, in Rett and Fragile X syndromes only – an option previously valueless to NEU or another strategic partner. Whilst the announcement of Acadia as Neuren’s ROW partner was not our top pick, we do appreciate the material synergies of this agreement and the outstanding financial terms Neuren have struck – materially increasing near term cash flows for investors and expanding the value of the NNZ-2591 opportunity. Given the DAYBUE launch update from Acadia, with run rates far exceeding our prior expectations, we are more confident in Acadia as a ROW partner than prior, noting that Acadia’s guidance has driven a pull forward of our Year 2 US launch estimates for DAYBUE, alongside associated sales milestones driving top and bottom line upgrades. First topline clinical data for NNZ-2591 in December has just become more valuable, for not only Neuren, but also Acadia. We are more bullish on the US launch, cautiously controlling upgrades in this early period.

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