Little known biopharmaceutical AXSM stock has been on a tear, and the stock has jumped by a staggering 550% as big news regarding one of the Axsome Therapeutics Inc’s (NASDAQ:AXSM) drugs proved decisive for many investors.
The New York-based company develops and sells medicines meant to improve the standard of life for patients who suffer from conditions related to the central nervous system. The company has developed its own proprietary formulations and needless to say, in a highly competitive industry, it gives Axsome a clear edge over many of its competitors.
The Rise
The tearing rise that AXSM stock experienced back in March is due to its AXS-O5, an antidepressant that is generic in nature and can be substituted with a range of medicines with similar formulations. However, back in January this year, it emerged that the AXS-O5 medicine is far more effective than the standard treatment that one can expect from competing drugs, and that is when the company’s stock came under the radar of shrewd investors.
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Prior to that, no one really took much notice of AXSM stock. Since January, however, things started rolling in a positive direction. The main constituent of the drug is bupropion and remains the preferred medicinal choice for physicians who treat major depressive disorders. In March, the stock exploded as investors realized that AXS-05 could generate millions in profits for the company.
The Competition
The only way for any company to maintain its position in a market is by maintaining its edge in the long-term. This is why the third phase of AXS-05 study is so important; it will essentially determine the long-term health of the company. In this regard, it is important to point out that Axsome Therapeutics is going to be in competition with some of the behemoths of the industry, one of which is Johnson & Johnson (NYSE:JNJ).
Johnson & Johnson has been given permission to sell ketamine in the form of medication to those suffering from clinical depression, and that could prove to be a huge disruption to Axsome’s sales. So, it is quite clear that AXSM stock and its drug are going to be in direct competition with a giant like Johnson & Johnson. That is going to be a competition that will have a big impact on the company’s future.
Featured image: DepositPhotos @ martinpolak
