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Investors Bet Big on Alzheimer’s Research as Acumen Shares Double

Two years after going public, Acumen Pharmaceuticals, Inc. (NASDAQ: ABOS) is experiencing a surge in its stock prices. The biotechnology company, based in Charlottesville, Virginia, saw its shares skyrocket by up to 80% in Monday morning trading. This surge in stock prices was a result of the company’s encouraging results from its Alzheimer’s disease study.

Some key points to note:

– Acumen Pharmaceuticals focuses exclusively on developing treatments for Alzheimer’s disease.
– The stock saw an 80% increase after reporting positive phase 1 results for its ACU193 drug candidate.
– The next few days will be crucial for Acumen as the excitement around biotech stocks can fade quickly when short-term traders take profits and move on.

The phase 1 INTERCEPT-AD trial of Acumen’s ACU193 drug candidate showed promising results in 65 early-stage Alzheimer’s disease patients across multiple locations. The trial involved single-ascending-dose (SAD) and multiple-ascending-dose (MAD) cohorts that received the treatment intravenously.

Acumen presented the data at the 2023 Alzheimer’s Association International Conference (AAIC) in Amsterdam over the weekend. The trial successfully met its primary and secondary objectives, demonstrating proof of the mechanism for ACU193. Notably, there was a statistically significant 25% reduction in amyloid plaque observed in higher dose cohorts at day 63. The therapy was well-tolerated with no serious adverse events reported.

Acumen plans to present the full results of the INTERCEPT-AD trial at a future medical meeting and submit them to a peer-reviewed clinical journal. Pending discussions with regulators, the company hopes to announce a timeline for a phase 2/3 clinical trial.

Acumen Pharmaceuticals’ growth pipeline primarily focuses on Alzheimer’s disease, setting itself apart from other biopharmaceutical companies. While this concentration brings some investment risk, it also presents significant opportunities. There are currently over 6 million affected Americans and an additional 26 million people worldwide who suffer from Alzheimer’s disease. Without new treatments, these numbers are expected to triple by 2050. The cost of healthcare associated with Alzheimer’s disease in the US alone could surpass $1 trillion by then.

Acumen is currently developing a novel antibody therapy for Alzheimer’s disease that targets soluble amyloid beta oligomers (ABOs). These ABOs are believed to accumulate in the brain 10 to 20 years before any symptoms of the disease appear, making them a primary cause of Alzheimer’s disease.

ACU193 is based on research that identifies early and persistent triggers of Alzheimer’s disease pathology. The drug candidate has received the Fast Track designation from the U.S. Food and Drug Administration (FDA).

Acumen’s leadership team includes former members of Eli Lilly’s global Alzheimer’s disease team, which adds to the company’s credibility. Eli Lilly recently announced its anticipation of an FDA decision on its donanemab Alzheimer’s treatment by the end of this year. While donanemab has shown promising results, there is still room for multiple winners in the Alzheimer’s disease market given the lack of effective treatments available. Additionally, Acumen’s focus is on treating early-stage Alzheimer’s disease rather than late-stage.

Following the AAIC presentation, H.C. Wainwright, a sell-side research group, reiterated its Buy rating on Acumen. The group valued the stock at $15.00 based on the potential profits ACU193 could generate by 2034 when the drug is expected to be commercialized. Other firms, including BTIG, have also expressed bullish opinions on Acumen this year, with a $22.00 price target set last month. This suggests that even after Monday’s jump in stock prices, the small-cap could potentially double in value over the next 12 months.

Investors had become impatient with their Acumen positions while awaiting phase 1 results, but Monday’s surge in stock prices shows how quickly biotech stocks can rebound when a promising drug candidate for a widespread disease is reminded to the market. However, it remains to be seen whether the stock will reach a double-top ceiling at the $11.00 mark or continue building momentum towards its $25.00 IPO price.

In order to make an informed decision about Acumen Pharmaceuticals, it is advisable to consider various factors and opinions. MarketBeat, for example, tracks top-rated research analysts who recommend stocks to their clients. While Acumen Pharmaceuticals currently has a “Buy” rating among analysts, there are other stocks that these analysts consider to be better investments.

MarketBeat’s analysts have recently released a report on their top five short plays for July 2023. This report highlights stocks with the highest short interest and provides insights on how to trade them.

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