Compass Pathways (CMPS, Financial) experienced a downgrade from Evercore ISI, moving from an "Outperform" to an "In Line" rating. The price target was also reduced to $6 from the previous $11. This decision followed the release of Phase 3 trial results for their first placebo-controlled study on psilocybin.
According to the analyst, the trial's MADRS effect size of 3.6 points was less impressive than anticipated, although the Data Safety Monitoring Board's comments on suicidal ideation were satisfactory. While the results suggest that Compass may have a potentially approvable drug, concerns remain about the durability of its effects, which is critical for commercial viability. This issue was also highlighted in previous discussions on psychedelic therapies and the firm's initiation of coverage on Mind Medicine. The trial's findings showed a lack of strong effect durability after six weeks, posing challenges for Compass Pathways moving forward.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 11 analysts, the average target price for Compass Pathways PLC (CMPS, Financial) is $16.82 with a high estimate of $45.00 and a low estimate of $11.00. The average target implies an upside of 575.40% from the current price of $2.49. More detailed estimate data can be found on the Compass Pathways PLC (CMPS) Forecast page.
Based on the consensus recommendation from 11 brokerage firms, Compass Pathways PLC's (CMPS, Financial) average brokerage recommendation is currently 1.7, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
CMPS Key Business Developments
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Compass Pathways PLC (CMPS, Financial) completed dosing in Part A of their pivotal phase 3 trial for treatment-resistant depression (TRD), marking a significant milestone.
- The company anticipates sharing 6-week top-line results in late June, which could demonstrate a meaningful improvement in treatment durability.
- A recent study published in the Journal of Clinical Psychology showed long-term benefits of a single 25 mg dose of CO 360 psilocybin, with an average time to depressive event of over 12 weeks.
- Compass Pathways PLC (CMPS) has a strong financial position with $260 million in cash and cash equivalents, expected to fund operations through the second phase 3 trial results in 2026.
- The company has established strategic collaborations, including with Healthport, to ensure broad and equitable access to their treatments if approved.
Negative Points
- The phase 2 follow-up study data was not as comprehensive as desired, leading to some limitations in interpreting the results.
- There is ongoing concern about suicidality as a potential side effect, which remains a topic of scrutiny and discussion.
- The company faces challenges in predicting placebo effects in their trials, which can complicate efficacy assessments.
- Manufacturing plans for the US are still in development, with no specific timeline for the additional site.
- There is uncertainty regarding the regulatory landscape and potential tariffs that could impact manufacturing and commercialization.
