Investors in Acadia Pharmaceuticals (ACAD - Get Report) will eye the pricing of the company's recently approved drug for the treatment of hallucinations and delusions in Parkinson's disease patients, which received FDA approval on Friday.
Acadia has yet to set the price for the drug, but in a Monday morning call with analysts said it would give guidance on the price "shortly."
Acadia's share price initially spiked to 7%, from $32.40 to $34.90 after the Friday announcement, but dropped Monday after Acadia held a morning call with analysts about Nuplazid. The stock closed at $33 per share, dropping 5.4% from the initial Monday morning spike.
The bio-pharmaceutical company, which operates in San Diego, Calif., plans to sell Nuplazid, which is the first drug of its kind, as soon as next month. The company has hired 132 representatives to market the drug across the United States. Acadia said it plans to target neurologists, psychiatrists and other physicians.
While the company declined to give quantitative guidance, it did note that adjustments should be made for potential fees, rebates, charge-backs associated with governmental purchase of the drug and product returns.
For now, according to Acadia, nuplazid will be distributed through four specialty pharmacies and two specialty distributors.
Though the drug is groundbreaking, Acadia did note that its market is relatively small. The company expects to do some "heavy lifting" on education and distribution of nuplazid.
Because nuplazid is an atypical antipsychotic drug, it received a black box warning from the FDA, which is the FDA's strictest warning and denotes severe risk if a drug is used incorrectly.
These warnings are not uncommon, though. Accutane, for example, the wildly popular drug for acne, has a black box warning for potential birth defects. SSRIs and SNRIs, or antidepressants, also have a black box warning thanks to causing suicide risk in children.
Paul Matteis, of Leerink Partners, called the warning on Nuplazid "fairly boilerplate."
Approximately 40% of that population have psychosis associated with the disease, which is characterized by the hallucinations and delusions Nuplazid will treat.
"Hallucinations and delusions can be profoundly disturbing and disabling," said Mitchell Mathis, M.D., director of the Division of Psychiatry Products in the FDA's Center for Drug Evaluation and Research in a press release. "Nuplazid represents an important treatment for people with Parkinson's disease who experience these symptoms."
The approval was largely expected, according to Matteis, as a prior FDA advisory committee vote showed 12 in favor and two members against the drug's approval.
According to the National Parkinson Foundation, which Acadia cited in its announcement that the drug has been approved, one million people in the United States and four to six million people worldwide have Parkinson's disease.
Acadia could not be reached for further comment on the drug's approval Monday.