ACST Stock Price Increases Over 35% Pre-Market: Why It Happened

By Amit Chowdhry ● June 23, 2021
  • The stock price of Acasti Pharma Inc (NASDAQ: ACST) increased by over 35% pre-market. This is why it happened.

The stock price of Acasti Pharma Inc (NASDAQ: ACST) increased by over 35% pre-market. This is a continuation of momentum from yesterday as the company stock price went up 10.2%, going from a previous close of $0.49 to $0.54. 

Yesterday morning, Acasti Pharma had announced its operating and financial results for the fiscal year ended March 31, 2021, and the company provided an update on its plans to acquire Grace Therapeutics and the ongoing strategic process for CaPre.

As part of Acasti’s formal process for exploring and evaluating a range of strategic alternatives to enhance shareholder value, management, and the board evaluated dozens of companies and conducted an extensive and thorough due diligence process on several finalist candidates. 

Acasti’s management and the board believe that Grace Therapeutics, a privately held emerging biopharmaceutical company focused on developing innovative drug delivery technologies for the treatment of rare and orphan diseases, stood out from the field of acquisition targets due to several important factors, including their diversified drug pipeline with multiple high-quality clinical assets, significant addressable market opportunities, three later-stage assets with a potentially shorter timeline to key milestones, efficient and low-cost clinical and regulatory pathway, and a strong and growing intellectual property portfolio. And Grace’s novel drug delivery technologies are designed for enabling the rapid development of new therapies that could improve upon currently marketed compounds with known safety profiles. Plus Grace’s most advanced drug candidates may also have a fast path to regulatory approval and commercialization via the 505(b)(2) pathway.

On May 7, 2021, Acasti had announced that it had entered into a definitive agreement to acquire Grace and its pipeline of drug candidates addressing critical unmet medical needs. The proposed transaction has been approved by the boards of directors of both companies and is supported by Grace’s shareholders through voting and lock-up agreements with Acasti. And the transaction remains subject to the approval of Acasti stockholders, as well as applicable stock exchanges.

In connection with the proposed transaction, Acasti will buy Grace’s entire therapeutic pipeline consisting of 3 unique clinical stage and multiple pre-clinical stage assets supported by an intellectual property portfolio consisting of over 40 granted and pending patents in various jurisdictions worldwide. And Grace’s product candidates aim to improve clinical outcomes by applying proprietary formulation and drug delivery technologies to existing pharmaceutical compounds to achieve improvements over the current standard of care, or they could provide treatment for diseases with no currently approved therapy. 

Grace’s 3 lead programs have all received Orphan Drug Designation from the U.S. Food & Drug Administration (FDA) — which could provide up to 7 years of marketing exclusivity in the United States upon FDA approval of the New Drug Application (NDA), assuming certain conditions are met.

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.