Entering text into the input field will update the search result below

AcelRx Pharmaceuticals: Is Wayne Gretzky Right Or The Puck?

Oct. 02, 2021 12:22 AM ETAcelRx Pharmaceuticals, Inc. (ACRX)30 Comments
Stephan Otzen profile picture
Stephan Otzen


  • DSUVIA 2q21 revenues were below my and market expectations.
  • But management provided further details regarding the Europe out-licensing agreement for DSUVIA and the in-licensing agreements.
  • And Formulary Approvals have picked up substantially also indicating gradually increasing interest in the product.
  • Management mentioned discussions about a DSUVIA out-licensing to the Asia-Pacific region.
Wayne Gretzky memorial in Edmonton

Wayne Gretzky memorial in Edmonton

alarico/iStock Editorial via Getty Images

I have covered AcelRx Pharmaceuticals (NASDAQ:ACRX) before, so investors should view this as an update to my previous articles.

This article updates my July 27, 2021 piece that analyzed ACRX’ then announced European sales cooperation with French private company Aguettant. It covers additional

This article was written by

Stephan Otzen profile picture
20 years of professional experience in audit, investing and consulting. Mathematician, private investor with a long-term view, based on fundamentals, long only.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of ACRX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (30)

IMPESSIVE, AcelRx closed on the Lowell Therapeutics (LTX) transaction on Monday, January 11, 2022:

AcelRx's Niyad™: "Breakthrough Designation status from the FDA" "ICD-10 code from CMS for reimbursement" "currently no FDA-approved products for anticoagulation of the dialysis circuit" USA Annual REVENUE potential: "$200 million" Note the WORLDWIDE Annual Revenue potential (source LTX former website): "$1.6 BILLION DOLLARS per year"

HUGE, ACRX the NEXT MRNA, yep CEO comment below!!! LTX-608 is AcelRx's proprietary nafamostat formulation for direct IV infusion being developed for the treatment of acute respiratory distress syndrome (ARDS) and disseminated intravascular coagulation #$%$. Nov 15th ACRX CEO comment Re: LTX-608: "there may be other potential uses for this unique protease inhibitor (LTX-608) that are particularly relevant during the current pandemic."
BUTLER FOR YOU profile picture
DSUVIA took over 15 years to develop, with the DOD investing over $30 million dollars. I guess many market participants/investors will feel much more comfortable once the first SKO-related DoD order comes in! Long $ACRX
BUTLER FOR YOU profile picture
@Stephan Otzen Delisting notice the other day and yet they purchase a company they have insufficient cash to fully get to market let alone Aguettantes single-dose drugs. CEO Vincent Angotti I do hope you have a plan because this doesn’t look like a plan.
ACRX is trading down ~40% since your article, from ~$1 to -$0.60. What is your take on the stock price today and current outlook?
Stephan Otzen profile picture
Fair question. I usually try to comment quarterly results here, but I am swamped with work at my actual job.
Plus, of course: I find the recent developments hard to grasp. 3q21 Revenue numbers were a disappointment again. Formulary Approvals do go up nicely, but this is partially due to a shift in strategy, i.e. by putting more focus on the tiny players. I am still convinced that their rather rapid adaptation is solid proof for DSUVIA's benefits and thus relevance in practice, but without adaption by large hospital groups sales numbers will not move up easily.
I can also see the conceptual perspective behind the Lowell acquisition, but find it hard to balance that with the inevitable cash need that comes with it (not to speak of dilution).
All of this is not helping with establishing an north-bound trend of the share price.
I guess many market participants will feel more comfortable once the first SKO-related DoD order comes in; or Revenue from hospital sales goes up.
Until then it's probably all about whether you believe that DSUVIA will find its way into the broader hospital market. ICUs crowded with people with an infectious disease are not helpful with that.
kwinter$ profile picture
Blah blah, what are potential revenues and why, where from? I don't that modeled anywhere, sales projections, growth in sales projections, that is what provides value to a company

last Q was great compared to previous and COVID would absolutely kill thier market as the largest share of post op that need opiods will be in a hospital

Wheres the revenue projections? cash flow projections? a stock is not analyzed without those
Stephan Otzen profile picture
I agree, of course, that earnings projections are a key feature of stock analysis.
However, given the uncertainty with ACRX and DSUVIA in the US in particular, the range of reasonable outcomes is massive.
But I am happy to share my base scenario from which you can draw your own conclusions (or disagree):
>1 During the next 5-7 years (let's take 6 as the midpoint) ...
>2 ... ACRX will reach US-non-DoD-DSUVIA sales of 7 million doses per annum.
>3 ACRX will cash in 28 USD per dose after third party sales expense
>4 Production cost per dose is <=20% of 30 USD = 6 USD
>5 Will incur USD 50 million annual internal cost
>6 Tax rate 30%
>7 Share count by then is 150 million, fully diluted
Thus: Net Revenue = USD 196 million (= 7*28)
Pre-tax profit (assuming no more debt by then) = USD 146 million (=196-50)
Net profit = USD 102 million (=147*0.7)
Market Cap = 1.5bn (assuming a P/E of ~15)
Share price = USD 10 (=1.500 / 150)
That would make for a ten bagger within 6 years.
If this is the path ACRX will take, I don't need more precise estimates (or adding DoD-business, EU-business for DZUVEO, sales to other armed forces, US syringe business etc.).
If DSUVIA makes its way into the US hospital market, we will be fine, be it at 20% annual compounding return or at 46.7% (=10^(1/6) - 1).
Thus it is key to understand what the chances are for DSUVIA to succeed.
And thus my focus on that very aspect.
I have nothing tangible to support especially my assumptions 2, 3, and 4 above - and I guess no one has. So we are all left with making up as good estimates as possible.
I believe there is down-side protection given the patent protection for an excellent product, but if there is no sales progress, all investors are likely to suffer more pain.
kwinter$ profile picture
@Stephan Otzen Thank you for the response and calculations, if they can penetrate the hospital market, possibly become standard of care and achieve a growth rate like that, the multiple will go through the roof!
Stephan Otzen profile picture
Should DSUVIA become the standard of care this would significantly affect my standard of living. ;-)
Every day this stock grinds lower. It’s very discouraging.
Stephan Otzen profile picture
I agree. It is no pleasure to follow the share price. I guess this is partly due to ongoing DoD "silence" and partly due to market concerns about increasing COVID numbers which may absorb hospital capacity (which could otherwise be used for e.g. certain types of surgergy) and thus slow down DSUVIA usage and acceptance.
BUTLER FOR YOU profile picture
An excellent article about $ACRX, very well done @Stephan Otzen! Some of the posters here on SA talking about a buy-out. So why would they tie the hands of a purchasing company by making an EU deal with a French pharma? Not happening, I am confident we will be fine but not getting sold too soon I’m afraid.
Stephan Otzen profile picture
Thank you for reading and commenting!
I have no basis for guessing about a soon-to-come buyout (and I am not sure at all that I would like to see one). But regarding your point: I guess it depends in the type of prospective buyer. A big pharma player probably has its own sales team over here in Europe, but PE firms or smaller pharma trying to broaden their offering could actually be happy to have that relationship closed.
October 6, 2021, article:


October 6, 2021, CEO comment on DOD:

AcelRx Pharmaceuticals (ACRX) has an interesting upside revenue opportunity with the U.S. Department of Defense according to CEO Vincent Angotti.

“Dr. Palmer was presenting the sublingual sufentanil profile at a medical conference, there were members of the Department of Defense in the audience who began to explore how it could be developed, packaged safely, etc., for use with battlefield pain management as again, they weren’t completely satisfied with their current offerings, those being intramuscular morphine and the fentanyl lollipop.

As a result, that relationship evolved and over the next 10 years, they invested in DSUVIA’s development.

It eventually was approved in late 2018. But since that time, they’ve continued to evaluate it to be sure it met all their primary objectives.

And even though it was approved in 2018, it took until April of 2020 for them to complete what’s called a Milestone C review, concluding that DSUVIA was approved for all Army sets, kits and outfits for deploying troops moving forward.

In addition, the Joint Deployment Formulary approved its use in September 2020. And just recently, in June of this year, they updated their pain battlefield guidelines on their website to show the inclusion of DSUVIA and how according to them. They feel it’s a beneficial alternative to what they’ve used historically.”
Most Of US’ Global Military Deployment Is Shifting From Europe To Asia; What’s Driving The Change?
By EurAsian Times Desk- May 28, 2021
I worked in the pharma industry for over 20 years, so I understand how long approvals take. The timing for Dsuvia was unfortunate, being right in the midst of the “opioid crisis”. Secondly, the company was relying on big DOD orders, but that may be dampened now with troops being withdrawn overseas. As a LT investor, I hope that they can turn revenue around, since I’m nursing a major loss right now.
@Britishgent July 2021
Two Army brigade deployments to Mideast and Europe announced
Army officials have announced two upcoming unit rotations to Europe and the Middle East.
@Britishgent so you think the DOD is retiring it's military? Unfortunately, not the case... Sadly, many think in 3 years we will be back in Afghanistan dealing with that mess...
@greatdayforinvestments Not at all, but without the DOD Dsuvia would probably never have been produced. Acrx is basically counting on them to be its biggest revenue stream until the medical facilities decide they want it. Personally, I wouldn’t be opposed to a takeover.
Stephan, this is also worth pointing out:

Mind-Boggling, so, about $100 million market cap, about $55 million cash:
- Quarter ending 9/30/21, initial milestone payment made from the European Partner founded in 1903...
- After years, and years, finally launching DZUVEO Europe in the 1st Half 2022...
- In Discussions in the "ASIA Pacific Region" (now that Europe is done, assembly line installed...)
- Installed (after months & months of delays due to COVID) the high speed assembly line (60% cost savings).
- "we're on track to exceed our goal of 615 approvals by year-end." Believe TRVN is hoping for 100 approvals by yr-end.
- Currently, #1 sales coming from Plastic Surgery, followed by #2 sales from Orthopedic Surgery...
- 2 new NDA ready prefilled Syringe drugs
- Multiple real world data reporting over next 18 months...
- Already reported in late 2020, game changing real world data showing the many benefit benefits of DSUVIA...
- On and on, etc.
Stephan, did you listen to the Cantor fireside chat format last week? You mention the H.C. Wainwright presentation, the previous week! If not, here you go:

AcelRx's Fireside Chat at the Cantor Fitzgerald Global Healthcare Conference 2021
September 28, 2021: wsw.com/...
- Details their Europe DZUVEO launch in 1st HALF 2022, with their partner Founded in 1903, a leader...
- Comments now that Europe is done, the high speed assembly line is installed, AcelRx is in discussions in the ASIA Pacific Region...
- CEO comments the Prefilled Syringe market is where we are heading, with efficiencies, safety, etc.
- Highly recommend you listen, lot of positive takeaways...
@greatdayforinvestments and of course, your well done presentation, mentions the 1st few bullet points...
More on prefilled syringes, etc.

ACRX has dozens of Orange Book Patents into 2031 (more pending) for their prefilled technology... HINT:

"Prefilled Syringes Market size was estimated at $5.6 billion in 2020, projected to grow at a CAGR of 8.3% during the forecast period 2021-2026."

"Syringes have played a crucial role in administering parenteral therapies, and in helping to guarantee that these therapies are microbially sterile and free of contaminants."

"In December 2020, Becton, Dickinson and Company (BD) has invested USD 1.2 billion in order to expand its manufacturing technology and capacity of Prefilled Syringes."

"Product launches, mergers and acquisitions, joint ventures and geographical expansions are key strategies adopted by players in the Prefilled Syringes Market."
@greatdayforinvestments profiled syringes are not easy to manufacture, I worked for many years for a company that did. Many things (including contamination) can ruin product. Don’t believe me, just look at the recent Teva recall as evidence. That’s why many manufacturers use third party companies to produce and package finished product.
Stephan, the prefilled syringe market seems to be where things are heading:

Prefilled Syringes Are the Preferred Choice
Waste reduction, time-savings and increased safety are among the benefits of purchasing preloaded medications.

April 8, 2021

Stephan Otzen profile picture
Thanks, that is helpful and adds to ACRX' management assessment about where the puck is headed for!
Again, nicely done! Like this quote:

TRVN does not have 1 drug in development in Europe, not 1. ACRX launches in Europe 1st HALF 2022:
July 14, 2021
"DZUVEO complements our existing product portfolio and we're delighted about this strategic opportunity to partner with AcelRx," said Eric Rougemond, Chief Executive Officer at Laboratoire Aguettant. "Our worldwide presence in the acute care space makes us an ideal European partner for DZUVEO. Partnering with AcelRx to commercialize two of our key acute care products in the U.S. further reinforces our mutual commitment to this strategic partnership."
stocks321 profile picture
Long ACRX.
Excellent write-up, albeit maybe could have included mentioning ARX-02, & ARX-03, both Phase 3 ready! Breakthrough cancer pain a big area, and underserved. Again, well done presentation!
Stephan Otzen profile picture
Thanks for the friendly feedback.
However, management has clarified at various occasions that they are not currently pursuing any activities around these products. That is why I do not mention them.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!

About ACRX

SymbolLast Price% Chg
Market Cap
Yield (TTM)
Rev Growth (YoY)
Short Interest
Prev. Close
Compare to Peers

More on ACRX

Related Stocks

SymbolLast Price% Chg
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.