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Acadia Pharma: What's Next?

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Psychosis is common in Parkinson's disease and is said to occur in about 40 percent of the patients. This condition is associated with increased caregiver burden, nursing home placement and mortality. There are no approved drugs to treat Parkinson's disease psychosis, or PDP, in which the patients develop psychotic symptoms like visual hallucinations and delusions.

Working on a drug for PDP is Acadia Pharmaceuticals Inc. (ACAD), whose lead compound Pimavanserin is under phase III testing.

For readers who are new to Acadia, here's a brief overview of the company's pipeline and the upcoming events to watch out for...

Acadia initiated a new phase III trial, dubbed 020 Study, evaluating Pimavanserin for the treatment of Parkinson's disease psychosis in the third quarter of 2010. According to a recent filing, 90 percent of the planned patient enrollment in the trial has been completed. The company expects the trial to be fully enrolled with 200 patients during August 2012, and report top-line results by the end of the third quarter of this year.

An open-label safety extension trial of Pimavanserin for Parkinson's disease psychosis, dubbed 015 Study, is also underway. This study consists of patients who have completed earlier phase III Parkinson's disease psychosis studies as well as patients who complete the 020 Study.

An initial phase III Parkinson's disease psychosis trial with Pimavanserin was unsuccessful and the company announced disappointing results in September 2009 as the study did not meet its primary endpoint of antipsychotic efficacy as measured using the Scale for the Assessment of Positive Symptoms, or SAPS.

Pimavanserin is a patented new chemical entity that selectively blocks serotonin 5-HT2A receptors and its worldwide rights now rest with Acadia. In 2009, Biovail Laboratories International SRL, a wholly owned subsidiary of Valeant Pharmaceuticals International, Inc. (VRX) licensed Pimavanserin from Acadia. However, in October of the following year, Acadia regained all rights to the drug candidate.

The company believes that Pimavanserin also has the potential to address psychoses associated with other neurological disorders, including Alzheimer's disease, and as a co-therapy for schizophrenia.

It is estimated that 25% to 50% of the 5.4 million Alzheimer's disease patients have Alzheimer's disease psychosis. There are no FDA-approved drugs to treat this condition. Earlier this month, the company reported promising effects of Pimavanserin in preclinical model of Alzheimer's disease psychosis.

Combining Pimavanserin with a low dose of Risperidone, a commonly prescribed atypical antipsychotic drug, is said to have the potential to provide an improved therapy for patients with schizophrenia, and related psychiatric disorders. In 2007, Acadia reported positive results from a phase II clinical trial that demonstrated advantages of co-therapy with Pimavanserin and a low dose of Risperidone.

Acadia's other drug candidates include, alpha adrenergic agonists for the treatment of chronic pain and Muscarinic agonist for the treatment of glaucoma, both being developed in collaboration with Allergan Inc. (AGN). In February of this year, the research term of the company's March 2003 collaboration agreement with Allergan was extended for one additional year, through March 2013.

As recently as July 13, the company discontinued the development of AM-831 for schizophrenia after it did not meet pre-determined criteria for further development in phase I testing. The compound was being developed in collaboration with Meiji Seika Pharma Co., Ltd.

A quick look at the company's balance sheet...

Acadia, formerly known as Receptor Technologies Inc., was founded in 1993. The name was changed to Acadia Pharmaceuticals in August 1997. Acadia went public in May 2004 pricing its IPO at $7 per share.

The company has not been profitable and has not generated any revenues from product sales. As of March 31, 2012, Acadia had an accumulated deficit of $353.1 million and cash of $25.9 million.

ACAD has thus far hit a 52-week low of $0.90 and a 52-week high of $2.30. The stock closed Wednesday's trading at $1.55, down 1.27% on a volume of 179,000 shares.

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