Acasti's Value Hidden In Plain Sight

Summary

• Significant growth in the prescription Omega 3 (Rx OM3) drug market.
• CaPre’s® has the potential to be the "best in class" Rx OM3.
• Over the next year, there are several key catalysts that can unlock value in shares of ACST and provide a significant asymmetric payout distribution for investors.

Introduction

Our long thesis on Acasti Pharma, Inc. (ACST) is built on two key pillars: 1) We see significant growth in the prescription Omega 3 (Rx OM3) drug market due to the clinically proven benefits of Rx strength OM3 used for treating hypertriglyceridemia (HTG), and recently shown to reduce the risk of atherosclerotic cardiovascular disease (ASCVD). 2) We believe that Acasti's drug, CaPre^®, has the potential to be the "best in class" Rx OM3, enabling it to take an underappreciated share of this market even without a Cardiovascular Outcome Trial (CVOT) of its own. Over the next year, there are several key catalysts that can unlock value in shares of ACST and provide a significant asymmetric payout distribution for investors.

Our insights are derived from a deep dive into scientific discovery, product development process, study design, clinical data, and the role of marketing strategy and launch preparation. A core element of our investment strategy is the expectation that CaPre's clinical data will show best-in-class performance in reducing triglyceride levels, addressing dyslipidemia, potential to reduce HbA1c, and bioavailability without food effect. We believe this story will be competitive and be enhanced by outcomes study findings, as the medical community pays close attention to the clinical evidence showing the significant performance of Rx OM3s in reducing elevated triglycerides, which then reduces the risk for ASCVD events.

Hypertriglyceridemia

Hypertriglyceridemia is a condition where triglycerides, a type of fat that circulates in the blood, are elevated above normal (>150 mg/dL). Triglyceride levels >150 mg/dL is one component of metabolic syndrome, which is a cluster of at least 3 metabolic conditions associated with increased risk of serious cardiovascular disease. Persistent hypertriglyceridemia >175 mg/dL and metabolic syndrome are both risk-enhancing factors associated with increased ASCVD risk.

Common therapies for hypertriglyceridemia include OM3s, fibrates, and niacin. Fibrates and niacin often

Analyst’s Disclosure:I am/we are long ACST, AMRN, MTNB. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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