Neuren Pharmaceuticals shares lift 4.7% on profit results
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The news: Neuren Pharmaceuticals shares climbed in morning trading after the company posted a profit of $157 million for the year to December 2023.
The numbers: Shares in Neuren were up 4.75% to $20.28 by 12:47pm AEDT.
After market close on Thursday, Neuren posted a profit of $157 million, up from $200,000. Revenue was at $231.9 million, up from $14.6 million, due to the licence agreement with its US partner Acadia Pharmaceuticals.
However, on Wednesday shares tanked more than 14% despite Acadia reporting that Q4 sales of its recently launched drug Daybue — a Retts syndrome treatment licensed from Neuren — totalled USD87.1 million ($133.4 million), reaching the top end of its guidance.
The context: Earlier in February, Neuren shares plunged more than 13% after US activist short-seller Culper Research published a report that said Acadia misrepresented the safety profile of Daybue.
What they said: However, Wilsons Advisory analysts said the outlook "could not be better" for Neuren, and that it had transitioned to a profitable, high growth pharmaceutical company.
They commented that Neuren's recent share price losses represented "further erratic market reactions to what we objectively view as an upside surprise from Acadia with their 4Q23 Daybue sales", with quarter sales and FY24 sales guidance both ahead of estimates.
"Seasonality is a key thing the market is grappling with now, with the recent short seller report seemingly enabling some lingering doubts about the reputability of Acadia and reliability of their FY24 guidance," they said.
"We have no reason to doubt them given their track record, noting this pulls forward revenue generation in our model...
"The share price selloff premised on the basis of a lowered Daybue peak sales number for around seven years from now, as opposed to a focus on the nearer term outlook — and solid guidance — is missing the point."
The analysts noted they maintained a "persistently overweight rating" on Neuren.
The source: ASX announcement
