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Nuplazid, a drug developed by Acadia Pharmaceuticals (ACAD) - Get ACADIA Pharmaceuticals Inc. Report , "minimally improved" hallucinations and delusions caused by Parkinson's disease while also exposing patients to a "substantial safety risk," a U.S. Food and Drug Administration review of the drug concluded on Friday.

Acadia, not surprisingly, views Nuplazid more favorably. The company argues the drug provides a "clinically meaningful benefit" with "robust improvements" across different measures of psychosis in Parkinson's patients. Study results also show Nuplazid has an "acceptable tolerability profile" with "well characterized safety risks," Acadia said in its own brief Friday.

On Tuesday, a panel of outside experts selected by the FDA will meet at the agency's Silver Spring, Md., campus to hash out the conflicting characterizations of Nuplazid. At the end the day-long meeting, the experts will be asked to vote, yes or no, whether Nuplazid should be approved for the treatment of psychosis in Parkinson's patients.

The outcome of the vote is hugely important to Acadia. An affirmative decision would most likely compel the FDA to approve Nuplazid by its decision date of May 1.

And if approved, Nuplazid could deliver peak sales in Parkinson's exceeding $1 billion, according to some generous analyst forecasts. (The company is also developing the drug to treat psychosis associated with other neurological diseases, including Alzheimer's.)

Good news on Nuplazid might also help reverse some tough times for Acadia shareholders. At Thursday's $20.31 close, Acadia's stock price has plunged 60% from its all-time high in July.

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Acadia's market value has shrunk along with the rest of the biotech sector since last summer. But the stock has also come under selling pressure because of investor concerns which echo the FDA's Nuplazid review. Nuplazid could be good enough to get approved, but minimal efficacy and questionable safety raise the risk that its use -- and sales -- will be limited.

The full FDA review of Nuplazid can be read here.

Acadia's summary of the Nuplazid data can be read



TheStreet plans to live blog Tuesday's Nuplazid FDA advisory panel meeting starting at 7:45 am EDT.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.