Axum Therapeutics, which just won FDA expansion for Overity for the treatment of Alzheimer’s disease agitation (ADA), projects peak sales of the non-antipsychotic drug to reach $8 billion.
The New York City biotech company expects to split revenue 50-50 between Auvelity’s two indications. It was originally approved in 2022 to treat major depressive disorder (MDD).
The $8 billion outlook is an increase from Axsum’s previous forecast of $2.5 billion to $6 billion. The company on Monday released new expectations in line with its first-quarter financial results (PDF).
Since receiving ADA approval on Thursday, Axum stock has risen 23%, with similar-sized gains triggered by the approval and renewed expectations for the company’s Auvelity.
In a conference call Monday, Ari Meisel, Axum’s chief commercial officer, pointed out that 76% of the 7 million people with Alzheimer’s disease are affected by symptoms of agitation, and that there are only two approved treatments on the market for the disease: Lundbeck and Otsuka Pharmaceutical’s Rexulti.
“When we consider HCP awareness, our own market research on the product’s potential uses, along with the clarity of the final label, we have confidence that Auvelity will be used as a front-line therapy for Alzheimer’s disease, and we see increasing use in front-line therapies and MDD,” said Maisel.
In response to Axum’s new estimate, Mizuho Securities raised its peak revenue forecast for Overity to $5 billion from $3.2 billion, with MDD at $2.6 billion and ADA at $2.4 billion. Mizuho’s previous sales were $2 billion from MDD and $1.2 billion from ADA.
“We believe there was already significant skepticism among investors as to whether Axsum would be able to achieve our previous high-end guidance range estimate of $6 billion. Therefore, at $8 billion, that skepticism is likely to increase even further,” Mizuho analyst Dr. Greig Svannabej said in a note to investors.
Suvarnavej added that in discussions with investors, some felt that given the high level of biopharmaceutical M&A activity this year, the updated guidance “subtly (or not-so-subtly) sends a message of Axsum’s potential future strategic objectives.”
Mizuho added that even though Axosome’s stock price has risen 45% in the past three weeks, it still finds the company “incredibly attractive at current levels.”
Analysts at Leerink Partners were also surprised by Axum’s “bold peak sales guidance.”
“While we certainly believe $2 billion per indication is realistic, management is even more confident given the planned sales force, marketing spend, contract growth, and slow and steady rise in the MDD treatment paradigm,” Leerink wrote.
Axum announced that it will increase the number of sales representatives to 630 to serve 68,000 healthcare workers. The company plans to launch Auvelity for ADA indications next month.
For the first quarter, Auvelity’s revenue reached $153 million, up 59% year-over-year, but down from $155 million in the fourth quarter of last year.
Axum is doing well in competition with Lundbeck and Otsuka, and Auberity’s sales last year rose 74% to $507 million. Meanwhile, Lundbeck reported that Rexulti’s 2025 sales rose 23% to Danish kroner 6.21 billion ($973 million).
Both are oral medications, making Overity the first non-antipsychotic drug option for ADA. Another point of differentiation, and one in Overity’s favor, is that Rexulti carries a black box warning that it increases the risk of death in patients with dementia-related psychosis.
Axsome’s next step in developing Auvelity is to launch a pivotal trial for smoking cessation. The company is also investigating Overity’s potential to treat other central nervous system conditions, according to Chief Operating Officer Mark Jacobson.
“This product is very interesting given that it targets NMDA and sigma-1 receptors and has potential applications in other neuropsychiatric disorders, and that is clearly what the research team is studying,” Jacobson said.
