NEW YORK - Axsome Therapeutics, Inc. (NASDAQ: NASDAQ:AXSM), a biopharmaceutical company, reported positive results from the ENCORE Phase 3 trial for its drug candidate AXS-12, used in the treatment of narcolepsy with cataplexy. The trial demonstrated a statistically significant reduction in the frequency of cataplexy attacks and improvements in cognition and overall narcolepsy symptoms compared to placebo.
The ENCORE trial consisted of a 6-month open-label treatment period with AXS-12, followed by a 3-week double-blind, placebo-controlled randomized withdrawal period. The study enrolled 68 patients, with 42 being randomized to either continue AXS-12 or switch to placebo. The primary endpoint was met, with patients continuing on AXS-12 showing fewer cataplexy attacks than those on placebo.
Notably, 72% of patients achieved at least a 50% improvement in cataplexy attacks after one month of treatment, with this figure rising to 82% after six months. Additionally, improvements in excessive daytime sleepiness and cognition were reported by a majority of patients, with a favorable long-term safety and tolerability profile observed.
Dr. Michael Thorpy indicated that the findings support AXS-12 as a potentially important new treatment option for narcolepsy, a condition that lacks adequate treatment options for its variety of symptoms. Axsome's CEO, Dr. Herriot Tabuteau, expressed the company's intent to move towards an NDA filing for AXS-12 and to request a pre-NDA meeting with the FDA.
AXS-12 has been granted Orphan Drug Designation for the treatment of narcolepsy, which may provide seven years of marketing exclusivity in the U.S. upon FDA approval. The drug is protected by patents extending to at least 2039.
The company highlighted that AXS-12's long-term dosing showed consistent safety with previously completed trials, with the most common adverse events being nausea and tachycardia. The rate of discontinuation due to adverse events during the open-label period was 17.6%.
The ENCORE study's results are based on a press release statement from Axsome Therapeutics and provide a promising outlook for AXS-12 as a potential treatment option for patients with narcolepsy.
In other recent news, Axsome Therapeutics has reported record-breaking revenue for the third quarter of 2024, surpassing $100 million for the first time, marking an 81% increase year-over-year. The revenue, primarily driven by product sales, exceeded analysts' expectations, with H.C. Wainwright reiterating a Buy rating and a $180.00 stock price target. The company's major depressive disorder treatment, Auvelity, and its excessive daytime sleepiness medication, Sunosi, significantly contributed to the total sales.
RBC Capital Markets also maintained an Outperform rating on Axsome shares, with a price target increase to $132, reflecting the company's recent financial performance and prospective milestones. Despite these gains, Axsome reported a net loss of $64.6 million but maintains a robust cash reserve of $327.3 million.
Recent developments include Axsome's plans to expand its sales force for Auvelity and preparation for the potential launch of its migraine treatment, AXS-07. However, the FOCUS study for solriamfetol in ADHD has been delayed to the first quarter of 2025. These recent developments underline Axsome's commitment to growth through its robust late-stage pipeline and strategic plans for expanding its sales force and market access.
InvestingPro Insights
Axsome Therapeutics' positive trial results for AXS-12 in narcolepsy treatment align with the company's strong financial performance and market position. According to InvestingPro data, Axsome has demonstrated impressive revenue growth, with a 51.47% increase in the last twelve months as of Q3 2023, and an even more striking 81.27% quarterly revenue growth in Q3 2023. This growth trajectory supports the company's ability to potentially commercialize AXS-12 successfully.
The company's gross profit margin of 91.09% in the last twelve months ending Q3 2023 is particularly noteworthy. An InvestingPro Tip highlights Axsome's "impressive gross profit margins," which could provide the financial flexibility needed to support the drug's development and potential market launch.
Despite these positive indicators, it's important to note that Axsome is not yet profitable, with an operating income margin of -72.65% in the same period. However, the company's strong market performance, with a 55.88% price return over the past year, suggests investor confidence in Axsome's pipeline and growth potential.
For investors seeking a more comprehensive analysis, InvestingPro offers 12 additional tips for Axsome Therapeutics, providing deeper insights into the company's financial health and market position.
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