I can only conclude the same - that those buyers who need/want to sell aren't finding any buyers right now due to overall lack of interest.

its annoying but Im comfortable with mid-term valuations. If it drops further or out of asx200 Ill be happy to buy more on discount.

@Aaronfzr I see there have been a few comments on the $NEU update today, and of all the comments made, I think you've summed it up nicely.

The SP Action

We have to remember that in these early stage biotechs, there is a fair amout of shareholders on the register who are positioned to take advantage of timing newsflow, i.e., speculative - "in for a good time not a long time."

Over the years investing in biotech, the pattern is ever thus. I imagine that for $NEU there are those who expect the next news to be confirmation of the advance into Phase 3 of NNZ-2591 and/or signs of a DAYBUE upgrade. Not having that news in a release is essentially the same as bad news. And with it, a chunk of hot money (and longer term holders wondering whether to take profits) seek to exit, without there being sufficient buyers wanting to get onboard.... there being no good news after all.

Quantitatively, today's volume of >1m shares is in the top-15-to-20 days volume-wise over the last year. Coming after several weeks of comparatively low volumes. When that happens, you are going to get an outsized price response.

So what was in the news?

To really understand what was going on you have to listen carefully to the recording of the $ACAD presentation at the JP Morgan healtcare conference.

Nothing in the timing of global rollout of DAYBUE should have been a surprise. If anything, there was positive news in that although EU approval is not expected until 2026, $ACAD expects some European revenues in 2025 via "Managed Access Programs in Certain EU Countries". Canada and Japan are in line with what has been said before.

There were no quantitative statements in the presentation about the 2024 revenue numbers, even though these will be known by now. All this means is that the aggregate revenue number (NUPLAZID + DAYBUE) must be within guidance.

So, what I think the market has picked up on, is the qualitative language CEO Catherine used to described the two products. She said that NUPLAZID is "growing strongly and is exected to continue to do so and accelerate in 2025." However, on DAYBUE she said that it is "expected to return to growth in 2025" supported by the addition of 30% to the sales force so that they can get "back to growth". The language was used very deliberately on two occasions in the presentation, as well as in the Q&A. This was carefully scripted. More specifically, Q3 has already "returned to growth" over Q2, so that makes me wonder "did it turn back down in Q4?" My guess is probably!

In the Q&A, the new Chief Commercial Officer reveled that they expected the impact of the changes of commercial strategy to take effect in Q3 2025. This is further evidence to me that we can expect a slow down if not in Q4 2024, then likely in Q1 and Q2 2025.

The expanded field force will be used to drive sales outside of the COEs (which have been the focus to date). 70% of patients are treated outside of the COEs, but is is a much more dilute market, with most of these clinicians perhaps only having one patient each. So sales force effectiveness is much lower here.

They will also be opening up a DTC channel. (I have no idea how effective that is in treatment of rare neurological conditions).

The starkly constrasting and very deliberate language around NUPLAZID and DAYBUE may have been to prepare the market for 1) a "meet" on group guidance, 2) a "beat" on NUPLAZID and 3) a "miss" on DAYBUE for 2024 revenue. Even if I have that wrong, directionally I think that is what is happening. $ACAD are crystal clear that getting DAYBUE to grow in the US requires a significant step up in the sales and marketing strategy.

Now of course, while on the one hand that could be seen to be bad news, we have to remember that $NEU is paid on a revenue royalty and milestone model, and higher sales and marketing costs by $ACAD do not impact the returns to $NEU. $ACAD clearly see further potential in DAYBUE, otherwise they wouldn't be signalling this intensification in their strategy, and so that can be seen as a positive.

As further good news, $ACAD reiterated that with DAYBUE in the market, the market of diagnosed patients has expanded around 20%.

Clearly, we all want to see unequivocally good news on DAYBUE and, by any measure, today was a mixed bag, with $ACAD potentially softening up the market for a weak result when the 2024 detailed results are announced in a few weeks time, as well as setting the scene for continued softness in Q1 and Q2 2025.

I thoroughly recommend that any shareholders in $NEU listen to the recording of the JP Morgan Conference earlier today, as there is a lot of good information that explains what is going on, especially in the Q&A section.

https://jpmorgan.metameetings.net/events/healthcare25/sessions/58353-acadia-pharmaceuticals-inc/webcast?gpu_only=true&kiosk=true

My Overall Assessment

I can understand the market reaction today, and management are clearly preparing the market for a soft DAYBUE result for 2024 and also for 2025 IMHO.

However, my two-for-price-of-one thesis remains intact. (OK, maybe its now 1.5 for the price of 1!)

There is uncertainty and risk here, and so while I see value here, I am NOT going to increase my position. For that I want to see confirmation that NNZ-2591 is advancing into phase 3. That's still an open question. Bad news there would be a thesis breaker.

There is a clear mismatch between the SP and analyst expectations. $11.01 close today vs. consensus of $26.21. I will be interested to see how many and to what extent the analysts begin to downgrade. Today's wasn't clear enough quantitatively, so perhaps they will await the FY number?

The wild card is: when are we getting the next newsflow on the NNZ-2591 Phase 3 design, and why is this taking so long?

Disc: Held in RL and SM

Having re-read the post in this thread by @mikebrisy - Thanks heaps for sharing your thoughts again on the current state of play with NEU Mike - and his concerns around DAYBUE likely (/possibly) being a "miss" compared to analysts' expectations when NEU report in Feb, I lodged a sell order during the night for all of the NEU in my super (3,600 shares) @ $14.79, hoping for a small spike on the open today from where they closed yesterday, and that order went through this morning while I was having a big sleep in after being up half the night with what I think is probably kidney stone pain.

NEU got up to $14.83 before falling by around -3% - currently trading at around $14.30. I will likely also sell my NEU shares here on SM today - or soonish.

In closing (that post) - Mike included this in his summary:

There is uncertainty and risk here, and so while I see value here, I am NOT going to increase my position. For that I want to see confirmation that NNZ-2591 is advancing into phase 3. That's still an open question. Bad news there would be a thesis breaker.

While I am fully aware that nothing posted here constitutes advice, I am also aware that Neuren Pharma is WELL outside my circle of competency (/wheelhouse) and so I do need to listen to wiser heads and analysis from people like @mikebrisy who have experience in pharma and biotech (among a wide-ranging array of other real-world experience), so my thought process yesterday and today is that having bought back into NEU recently - on December 13th @ $13.35 and then buying a second tranche a week later on December 20th @ $12.55 and then a third tranche in mid-Jan (15th Jan) @ $11.07 for an average buy price of $12.69 for $45,700 invested, I'd rather step to the sidelines ahead of NEU's report next month and lock in $7,540 worth of short-term profit (+16.5% return on $45,700 in under 2 months), and if NEU do underwhelm when they report (in terms of DAYBUE sales and revenue) then I MAY get the opportunity to jump back onboard at a lower price. If not, there are plenty of other fish in the sea.

I mention this here today only because I spent a little time here in December explaining why I was prepared to invest in NEU but not go back into AD8 at that point, because I thought NEU may have bottomed or were close to bottoming but that AD8 looked to me like they would keep drifting south on a lack of positive newsflow, for the next 6 to 18 months anyway. I also mentioned that I was back in a position to consider companies like NEU as 3 to 5 year investments rather than worry about what their share price would do in the short term. However, my preference was and still is to NOT hold companies when I feel their share price is more likely to continue to fall lower; I want to hold more companies where I believe that both the near-term and longer-term outlooks are positive in terms of likely positive catalysts that should drive the company's valuation and share price higher.

I rated NEU as one of those companies, but with the benefit of reflection and reminding myself that I am well out of my depth with biotechs and pharma companies, I have changed my view on what I think will/may most likely happen in the short-term with NEU, and now I am concerned that after their recent SP rise towards $15/share, there is plenty of potential for sellers to drive their SP significantly lower when they report in Feb - due to the absence of buyers - as happened recently when they dropped to as low as $10.90 on January 15th.

If I'm wrong and they power ahead back towards $20/share or beyond, then I'll have foregone that upside and capped my potential gains, and I'll live with that. I'd rather be on the sidelines when I'm either undecided or negative on a company either short-term or long-term, unless they're a high conviction position where I'm super-confident that they're cheap at current levels and are going to be trading significantly higher in the mid-term and longer-term - which was how I felt (and continue to feel) about Lycopodium (LYL) when I was buying heaps around that recent $10/share level.

I don't have the same conviction with NEU. I do see risks with NEU that I am not comfortable to be able to quantify in terms of likelihood. Mike's post reminded me that it's not all about DAYBUE. There are other strings to their bow, and they really need everything to go right to be worth what the bullish brokers and other analysts are suggesting they are worth - consensus of $26.21/share - and in the meantime they need to keep meeting or exceeding analysts' expectations on DAYBUE.

So back from 11 positions in my SMSF (CBUS Super portfolio) to now 10 this morning. I haven't decided where I'm going to redeploy that $53.3 K yet, but happy to have converted it to cash at this point - it's earning 5.25% p.a. as cash so it's not dead money.

Disclosure: I now do not currently hold NEU in any real-money portfolios as at 28th Jan 2025. Also still not holding AD8. Will likely hold AD8 in future years when they're back in a strong uptrend on the back of strongly growing sales and profits, but I may well stay clear of NEU now - subject to change of course.

@Bear77 interesting perspectives.

While you have correctly described my view of the short term risk around DAYBUE, I am not prepared to trade $NEU in such a narrow range. But well done on your gains!

That's because I think the upside from positive progress into the PMS Phase 3 trial for NNZ-2591 will potentially more than offset any decline from a disappointing DAYBUE number in a few days.

In fact, I think $ACAD have pre-positioned themselves for this in the JP Morgan speech and Q&A. Whatever the Q4 DAYBUE number, they'll express confidence for growth based on two drivers:

1. Adding 30% to the sales force to "return to growth" later in 2025 ("Q3") focusing on the 70% of the total US market that lies beyond the Centres of Excellent
2. EU, UK and Canada contributing to international growth in 2026.

Oh, and there's always the winter blizzards to blame for a soft quarter! (Call me cynical.)

So my risk-reward assessment in my base case is $SP impact (DAYBUE sales disappoint) < $SP impact (NNZ-2591 advances to Phase 3).

Of course, as I wrote in my post, if for any reason NNZ-2591 doesn't advance, then I'm out.

Understood @mikebrisy - and thanks for the further clarification. That big downside risk of NNZ-2591 not advancing was also weighing on my mind, even though I can't quantify the likelihood of that outcome. As I said, your previous post here reminded me that it's not all about DAYBUE.

For all holders, I certainly hope you're right that the majority of the market will decide that the positives outweigh any negatives when NEU report, and the SP continues to rise.

I'm still happy to be out again personally however, because I started to get that nagging feeling in the back of my mind that once again I had invested in a company that I don't understand nearly enough about.

I don't like that feeling.

@Bear77 - I know what you mean. The longer I invest, the more reluctant I am to invest in firms I don't fully understand, or at least understand well.

My big sells last year were 1) $MQG and 2) $CSL - as I just couldn't get comfortable that I really understood them well enough, despite having held them for years. In both cases there are just too many moving parts. Track record, analyst views, good management, "blue chip" just doesn't do it for me.

I don't mind taking risks - in fact, I enjoy it. But I want to go to bed knowing what risks I have taken.

That familiar quote... know what you own, and why you own it.

For me Elders is one - I can see a lot of structural potential but just can't get my head around their business.