Buy Rating for Axsome Therapeutics: Promising Subgroup Analysis in MDD with EDS Warrants Further Investigation

Leerink Partners analyst Marc Goodman has maintained their bullish stance on AXSM stock, giving a Buy rating yesterday.

Marc Goodman has given his Buy rating due to a combination of factors related to Axsome Therapeutics’ strategic approach in addressing Major Depressive Disorder (MDD) with Excessive Daytime Sleepiness (EDS). Although the overall study did not achieve statistical significance in the primary endpoint for the general MDD population, the data showed promising improvements in depressive symptoms for the subgroup of patients with severe EDS treated with Sunosi. This subgroup analysis, despite not being powered for statistical significance, suggests potential benefits that warrant further investigation.
Goodman notes that approximately half of MDD patients experience EDS, making Axsome’s targeted strategy potentially impactful. The approach is somewhat validated by similar strategies in the field, such as J&J’s successful Phase 3 study with seltorexant in MDD patients with insomnia. While the current data might not immediately affect stock prices, the innovative path Axsome is pursuing in precision medicine within psychiatry is noteworthy. The anticipation of additional data and the company’s plans for a Phase 3 trial in 2025 contribute to the positive outlook and Buy rating.

According to TipRanks, Goodman is a 4-star analyst with an average return of 2.7% and a 43.20% success rate. Goodman covers the Healthcare sector, focusing on stocks such as Axsome Therapeutics, Evolus, and Stoke Therapeutics.

In another report released yesterday, H.C. Wainwright also reiterated a Buy rating on the stock with a $200.00 price target.