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We came across a bullish thesis on Achieve Life Sciences, Inc. (ACHV) on Substack by Jacob Rowe. In this article, we will summarize the bulls’ thesis on ACHV. Achieve Life Sciences, Inc. (ACHV)'s share was trading at $3 as of Jan 23rd.
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Achieve Life Sciences (ACHV) presents a compelling investment opportunity, with its nicotine cessation drug, Cytisinicline, positioned to disrupt the market. The company has reached a significant milestone in its development, completing a six-month safety study involving 300 patients without any safety concerns, paving the way for an NDA submission in April/May. As Cytisinicline holds breakthrough designation, the likelihood of a priority review is high, particularly given its superior efficacy and safety profile compared to Chantix, the previous category leader now available as a generic. This positions Achieve for substantial upside potential, especially as the stock currently trades near 52-week lows despite being de-risked.
Cytisinicline’s data from multiple Phase 3 trials underscores its efficacy, with odds ratios significantly outperforming Chantix. For example, while Chantix achieved an odds ratio of 2.88 over a 12-week trial, Cytisinicline demonstrated odds ratios between 5.0 and 6.3 in comparable trials, alongside fewer side effects. Its safety profile closely mirrors typical nicotine withdrawal symptoms, further solidifying its appeal. With an expected price point of $700–$800, Cytisinicline could capture a significant share of the $1 billion-plus nicotine cessation market. Even a conservative 30% market share implies $300 million in annual revenue, supporting a valuation of approximately $1 billion at 3x sales. A 60% share would push revenue to $600 million and valuation to $1.8 billion, representing a potential 5x–10x return for investors based on the current diluted share count.
The timeline for additional catalysts is clear. Results from the ongoing one-year safety study, which involves 100 patients continuing from the initial cohort, are expected by mid-year, further de-risking the investment. Achieve’s strategic positioning, bolstered by its new investment banking board members and a cash runway through Q3 2025, increases the probability of a buyout in 2025. Moreover, priority review could lead to a PDUFA date in Q4 2024, potentially driving a sharp valuation rerating as biopharma funds recognize the mismatch between market price and intrinsic value. With its transformative potential and favorable risk/reward profile, Achieve Life Sciences stands as a strong candidate for multi-bagger returns.