HCW starts Axsome Therapeutics at buy; PT $10

H.C. Wainwright initiated coverage of Axsome Therapeutics (NASDAQ:AXSM) with a “buy” rating and price target of $10. The stock closed at $3.60 on June 6.

Axsome, which is focused on central nervous system (CNS) therapeutics, seeks to optimize existing drugs and develop proprietary combinations where applicable in areas of significant unmet need.

“In concentrating on compounds that are well-established from a safety and activity profile perspective, Axsome eliminates some of the risks associated with conducting CNS-centric drug development, which has historically been considered a minefield for drug developers,” writes analyst Raghuram Selvaraju.

The company is also advancing its programs via the 505(b)(2) pathway, which allows for accelerated development involving agents that have already been approved for other uses or in other formulations, while extending substantially greater market exclusivity protection, compared with generic drug products, he added.

Mr. Selvaraju said Axsome has a broad clinical-stage pipeline with multiple shots on goal including, AXS-05, in pivotal testing for treatment-resistant depression and agitation associated with Alzheimer’s disease, as well as mid-stage testing for smoking cessation; AXS-02, in Phase 3 development for treatment of knee osteoarthritis and chronic lower back pain; and AXS-07, in Phase 2 development for the treatment of migraine.