ACADIA Pharmaceuticals Inc. — FY 2021 Form 10-K
Reporting period: Fiscal year ended December 31, 2021; filed February 28, 2022. The company develops and commercializes CNS medicines. NUPLAZID (pimavanserin), approved for Parkinson’s disease psychosis (PDP), was its only commercial product. Financial statements received an unqualified audit opinion.
Financial performance and liquidity
| Metric | FY 2021 | FY 2020 |
|---|---|---|
| Revenue, all NUPLAZID net sales | $484.1 million | $441.8 million |
| Gross profit / gross margin | $473.3 million / 97.8% | $431.5 million / 97.7% |
| Research and development expense | $239.4 million | $319.1 million |
| Selling, general and administrative expense | $396.0 million | $388.7 million |
| Operating loss | $(170.4) million | $(286.6) million |
| Net loss | $(167.9) million | $(281.6) million |
| Net loss per diluted share | $(1.05) | $(1.79) |
| Cash used in operating activities | $125.7 million | $136.2 million |
Fourth-quarter 2021 revenue was $130.8 million versus $121.0 million in fourth-quarter 2020; net loss was $43.1 million versus $66.8 million. Annual NUPLAZID sales grew about 9.6%, reflecting a higher average gross selling price and approximately 3% unit growth. Management said pandemic-related limits on patient visits, healthcare-provider access and long-term-care occupancy continued to weigh on sales.
Cash, cash equivalents and investment securities totaled $520.7 million at year-end, down from $632.0 million. Current assets were $617.8 million and current liabilities $96.1 million. The balance sheet reports no borrowings; operating lease liabilities totaled $64.4 million. Total liabilities were $159.2 million. Contractual obligations included $81.1 million of operating leases and other long-term commitments. The company said existing cash resources were expected to fund planned operations for at least 12 months, while noting potential need for additional financing. It reported an accumulated deficit of $2.2 billion and expected losses to continue for the next few years.
Material changes and business developments
- Revenue increased from 2020, while net loss narrowed substantially. R&D expense fell mainly because 2020 included CerSci acquisition consideration and costs and the Vanderbilt M1 PAM upfront payment; SG&A rose modestly.
- The 2% royalty obligation to Ipsen on NUPLAZID sales ended in October 2021, contributing to lower license fees and royalties.
- December 2021 top-line results from the Phase 3 LAVENDER trial of trofinetide showed statistically significant improvement on both co-primary endpoints and a key secondary endpoint for Rett syndrome. Treatment-emergent adverse events led to discontinuation in 17.2% of trofinetide recipients versus 2.1% on placebo; diarrhea was reported in 80.6% versus 19.1%.
- In February 2022, ACADIA resubmitted an sNDA for NUPLAZID for Alzheimer’s disease psychosis (ADP), after FDA’s April 2021 complete response letter on the broader dementia-related psychosis application. The FDA had cited subgroup evidence and study-design concerns.
- In January 2022, the company entered a Stoke Therapeutics collaboration, paid a $60 million upfront fee, and could owe up to $907.5 million in additional milestones plus royalties. These are subsequent-event terms, not 2021 operating expenses.
Outlook, risks and contingencies
Management planned to submit an NDA for trofinetide for Rett syndrome around mid-2022, anticipated ADVANCE-2 schizophrenia trial results in 2023, and expected ACP-044 Phase 2 results around the end of Q1 2022 for postoperative pain and around year-end 2022 for osteoarthritis pain. No numerical 2022 financial guidance is provided in the supplied filing text.
Key uncertainties include regulatory approval and clinical-trial outcomes, NUPLAZID commercialization and pandemic recovery, reimbursement and drug-pricing pressures, dependence on a small number of distributors and pharmacies, and reliance on third-party manufacturers. Four U.S. customers represented approximately 74% of 2021 revenue. Generic-drug patent litigation remained ongoing; a joint trial against certain defendants was scheduled for May 2023, while Hetero settled with a stated generic launch date of July 27, 2038, subject to earlier-launch triggers. A separate securities class action and derivative litigation were also disclosed. Management said it could not estimate possible losses and had not accrued litigation amounts other than legal fees; it did not expect pending claims to have a material adverse effect, while noting litigation outcomes are unpredictable.
Investor verification points
- Track NUPLAZID net sales, unit growth, pricing, gross-to-net rebates and the continuing effects of COVID-19.
- Review the FDA’s response to the ADP resubmission and the timing, evidence and safety profile supporting a trofinetide NDA.
- Assess cash use, expected operating runway, and the potential funding impact of development plans and contingent collaboration milestones.
- Monitor generic-patent litigation, patent-term protection, and the status of the remaining NUPLAZID post-marketing safety commitment.
- Verify clinical-trial milestones and tolerability findings for trofinetide, ACP-044 and pimavanserin’s schizophrenia program.