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1. Company Snapshot

1.a. Company Description

Praxis Precision Medicines, Inc., a clinical-stage biopharmaceutical company, develops therapies for central nervous system disorders characterized by neuronal imbalance.Its lead product candidates include PRAX-114, an extrasynaptic-preferring GABAA receptor positive allosteric modulator that is in Phase IIa clinical trial for the treatment of major depressive disorder and perimenopausal depression; and PRAX-944, a selective small molecule inhibitor of T-type calcium channels, which is in Phase IIa clinical trial for the treatment of essential tremor.The company is also developing PRAX-562, a persistent sodium current blocker that is in Phase I clinical trial to treat severe pediatric epilepsy and adult cephalgia; PRAX-222, an antisense oligonucleotide (ASO) for patients with gain-of-function (GOF) SCN2A epilepsy; and KCNT1 program for the treatment of KCNT1 GOF epilepsy.


It has a cooperation and license agreement with RogCon Inc.; a license agreement with Purdue Neuroscience Company; a research collaboration, option, and license agreement with Ionis Pharmaceuticals, Inc.; and collaboration with The Florey Institute to develop three novel ASOs. The company was incorporated in 2015 and is based in Boston, Massachusetts.

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1.b. Last Insights on PRAX

The recent performance of Praxis Precision Medicines, Inc. was negatively impacted by the interim analysis of Study 1 for the Essential3 program of ulixacaltamide in essential tremor, which was recommended to stop for futility. This significantly lowers the chances of success for ulixacaltamide in this indication. Additionally, the company's epilepsy pipeline, led by vormatrigine and relutrigine, faces intense competition in the focal epilepsy market.

1.c. Company Highlights

2. Praxis Precision Medicine's Vormatrigine Shows Promising Efficacy in RADIANT Study

The company's financial performance for the second quarter of 2025 showed a loss per share of $3.31, which was better than the estimated loss of $3.4. The revenue growth estimate for next year is 3633.8%, indicating a significant increase in sales. The current valuation metrics show a Price-to-Sales Ratio of 129.69, a Price-to-Book Ratio of 2.54, and an EV/EBITDA of -3.19, suggesting that the market is pricing in high growth expectations.

Publication Date: Aug -28

📋 Highlights
  • RADIANT Efficacy: Median seizure reduction of over 56%, with 60% of patients achieving ≥50% reduction (n=35 focal, n=15 generalized epilepsy).
  • Safety Profile: Adverse events were predominantly mild/moderate (90% resolved over time), with no significant drug-drug interactions.
  • Trials Pipeline: POWER2 (stand-alone therapy) to launch, enrolling patients off current ASMs; POWER3 (first-line therapy) planned for 2026.
  • Response Consistency: Over 55% response rate in patients on cenobamate, matching or exceeding baseline expectations.
  • Unique Mechanism: Targets epileptic activity directly, potentially disease-modifying, with mood/function improvements noted informally by investigators.

Financial Highlights

The company's financials are expected to be driven by the potential approval and commercialization of vormatrigine. With a current ROE of -60.07% and ROIC of -67.06%, the company's returns are negative, but this is expected to improve as the drug moves through the development pipeline. As Marcio De'Souza mentioned, "We're excited to share the RADIANT results for vormatrigine. Focal epilepsy is a serious medical condition impacting about 3 million U.S. patients."

RADIANT Study Results

The RADIANT study results showed a median seizure reduction of over 56% and 60% of patients achieving at least a 50% reduction in seizures. The response rate was high across all patient subgroups, regardless of baseline seizure burden. Vormatrigine demonstrated a favorable overall safety profile, with most adverse events being mild to moderate and resolving over time.

Future Plans

The company plans to initiate POWER3 in early 2026, which will establish vormatrigine as a first-line therapy. The POWER2 study aims to enroll refractory epilepsy patients transitioning off current ASMs. The company believes that vormatrigine has the potential to make a real difference for people living with refractory epilepsy.

Valuation and Growth Expectations

With a current Price-to-Sales Ratio of 129.69, the market is pricing in high growth expectations for the company. The estimated revenue growth rate of 3633.8% next year suggests that the company is on track to deliver significant sales growth. However, the negative ROE and ROIC indicate that the company's returns are currently negative, but this is expected to improve as the drug moves through the development pipeline.

Disease Modification Potential

The company believes that vormatrigine may have a disease-modifying benefit, as it targets the underlying epileptic activity. Steven Petrou explains that the reduction in seizures over time is a sign of reversing the disease process, leading to disease modification and improvement across multiple areas.

3. NewsRoom

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Praxis' Epilepsy Drug Too Good To Continue, FDA Meeting Up Next

Dec -05

Source: benzinga.com

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Praxis Precision Medicines Stock Surges 25% In Friday Pre-Market Trading— What's Going On?

Dec -05

Source: feeds.benzinga.com

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Praxis Precision Medicines Announces Positive Results from EMBOLD Study for Relutrigine in SCN2A and SCN8A Developmental and Epileptic Encephalopathies

Dec -04

Source: globenewswire.com

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Praxis Precision Medicines Announces Positive Pre-NDA Meeting with FDA for Ulixacaltamide in Essential Tremor

Dec -04

Source: globenewswire.com

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Praxis Precision Medicines, Inc. Announces Inducement Grants Under Nasdaq Listing Rule 5635(c)(4)

Dec -03

Source: globenewswire.com

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Praxis Precision Medicines, Inc. $PRAX Shares Acquired by Geode Capital Management LLC

Dec -01

Source: defenseworld.net

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Praxis: Moving To Strong Buy Based On Ulixacaltamide Success In Treating ET

Nov -26

Source: seekingalpha.com

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Praxis Precision Medicines, Inc. (PRAX) Discusses Essential3 Program and Statistical Modeling Approaches in Clinical Studies Transcript

Nov -25

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.27%)

6. Segments

Pharmaceuticals

Expected Growth: 10.27%

Praxis Precision Medicines, Inc.'s pharmaceutical segment growth of 10.27% is driven by increasing demand for personalized therapies, strategic partnerships, and investments in R&D. The company's focus on rare genetic disorders and innovative gene therapies also contributes to its growth. Additionally, expanding product pipelines and regulatory approvals in key markets further support the segment's upward trend.

7. Detailed Products

PRAX-114

A novel, oral, small molecule designed to modulate the N-methyl-D-aspartate (NMDA) receptor, with potential therapeutic benefits for neurological and psychiatric disorders.

PRAX-944

A novel, oral, small molecule designed to modulate the 5-HT2C receptor, with potential therapeutic benefits for neurological and psychiatric disorders.

PRAX-115

A novel, oral, small molecule designed to modulate the AMPA receptor, with potential therapeutic benefits for neurological and psychiatric disorders.

8. Praxis Precision Medicines, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Praxis Precision Medicines, Inc. has a moderate threat of substitutes due to the presence of alternative treatments and therapies for genetic diseases.

Bargaining Power Of Customers

Praxis Precision Medicines, Inc. has a low bargaining power of customers due to the lack of negotiating power of individual patients and the high demand for rare genetic disease treatments.

Bargaining Power Of Suppliers

Praxis Precision Medicines, Inc. has a moderate bargaining power of suppliers due to the presence of multiple suppliers for raw materials and equipment, but also due to the specialized nature of some of the inputs required.

Threat Of New Entrants

Praxis Precision Medicines, Inc. has a high threat of new entrants due to the growing interest in genetic medicine and the potential for new companies to enter the market with innovative technologies.

Intensity Of Rivalry

Praxis Precision Medicines, Inc. operates in a highly competitive industry with several established players, leading to a high intensity of rivalry among companies.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 3.46%
Debt Cost 3.95%
Equity Weight 96.54%
Equity Cost 18.31%
WACC 17.81%
Leverage 3.58%

11. Quality Control: Praxis Precision Medicines, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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G1 Therapeutics

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Quality: 4.2

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Praxis Precision Medicines

A-Score: 3.5/10

Value: 6.0

Growth: 7.9

Quality: 4.7

Yield: 0.0

Momentum: 2.5

Volatility: 0.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

247.99$

Current Price

247.99$

Potential

-0.00%

Expected Cash-Flows