ACADIA Pharmaceuticals Inc. (NASDAQ: ACAD) has plunged 23.36% (source: google finance) on April 10th, 2018 after CNN published a news report that shows a growing number of patient deaths and adverse effects that may be related to the use of ACAD’s drug Nuplazid. Nuplazid is a drug which was given approval by the U.S. Food and Drug Administration (FDA) and began its sale to customers in June 2016. The drug was given fast-track approval by the FDA  based on a six-week study of about 200 patients, despite concerns that it may not actually help those suffering from Parkinson’s disease. Now, physicians, medical researchers, and other experts are worried that the drug had been approved too quickly, based on too little evidence that it was safe or effective.

Shortly after the drug’s sale, the patients’ family members, doctors, and other healthcare professionals had started reporting “adverse events” possibly linked to the medication including deaths, life-threatening incidents, falls, insomnia, nausea, and fatigue. In more than 1,000 reports, the patients continued to experience hallucinations while on Nuplazid. Further, more than 700 patients taking Nuplazid have died since the drug was launched and Nuplazid was also listed as “suspect” in at least 500 reported cases.

After analyzing the adverse event data for Nuplazid, the Institute for Safe Medication Practices had concluded that this batch of reports “reinforces the concerns of those who warned that (Nuplazid) might do more harm than good.”

Meanwhile, ACAD has responded to this report. As per ACAD, the patients who develop Parkinson’s disease psychosis (PDP) tend to be older and are chronically ill. These patients also tend to be on many different medications and show numerous medical comorbidities.  Further, ACAD is regularly monitoring the mortality risk for Nuplazid and reports data to the FDA each quarter. As per the company, since launch, the overall mortality rate of patients who use Nuplazid is 12.4 deaths per 100 patient years. This is as according to the company less than half of the 28.2 deaths per 100 patient years that is observed in the PDP population in general.

Furthermore, the FDA has not identified a specific safety issue that is not already described in Nuplazid’s labeling. Additionally, Acadia had conducted two studies that involve more than 300 patients with Alzheimer’s disease since the drug’s approval in 2016. The results from the studies show, there was no difference in the number of deaths reported among patients who use Nuplazid or a placebo.

However, the investors are reacting negatively to this news.