Neuren (NEU): Short Thesis Dismantled as Acadia Targets $700M Daybue Sales by 2028
Culper Research predicted Daybue peak sales of just $316M in 2024. Acadia just announced a $700M target by 2028. With 5.76% short interest and the stock up 61% in a year, is a squeeze brewing?
In February 2024, NYC-based short seller Culper Research released a scathing report on Acadia Pharmaceuticals and its Rett syndrome drug Daybue (trofinetide), sending shockwaves through Neuren Pharmaceuticals (NEU) - the Australian biotech that receives royalties on every Daybue sale. Culper claimed Daybue was a "total flop" and predicted peak revenues would be "a mere fraction" of analyst estimates.
Fast forward to January 2026, and Acadia has just announced at the J.P. Morgan Healthcare Conference that they're targeting $700 million USD in Daybue sales by 2028 - more than double what Culper predicted would be the drug's peak. The short thesis has been comprehensively dismantled.
The Culper Short Report: What They Got Wrong
In mid-February 2024, Culper Research took a short position on Acadia Pharmaceuticals and published a report that hammered both ACAD and NEU shares. Neuren plunged 14% on the news.
Culper's Key Claims:
| Claim | Culper's Position |
|---|---|
| Peak Daybue Revenue | "Mere fraction" of $800M analyst estimates |
| 2024 Revenue Estimate | $316 million USD |
| Patient Retention | Allegedly poor; low persistence rates |
| Drug Efficacy | Called it a "total flop" |
| Trajectory | "Will continue to decline over time" |
Culper alleged that "Acadia has misrepresented Daybue's safety profile, and in turn, patient retention rates." They predicted Daybue would generate just $316 million in 2024, versus analyst expectations of $379 million.
The Reality Check
Neuren and Acadia immediately pushed back. The company released a statement to the ASX dismissing Culper's claims and reconfirming guidance. When Q4 2023 results came in, Daybue sales hit US$87.1 million - at the top end of the $80-87.5 million guidance range.
More importantly, Acadia confirmed 76% of patients remained on therapy after 6 months based on confirmed discontinuations - directly contradicting Culper's claims about poor retention.
For FY2024, Acadia guided to US$370-420 million in Daybue net sales, well above Culper's $316 million prediction.
Acadia's $700M Bombshell at JPM 2026
At the 44th Annual J.P. Morgan Healthcare Conference on January 13, 2026, Acadia CEO Catherine Owen Adams unveiled the company's long-term ambitions:
The 2028 Targets
| Drug | 2028 Target |
|---|---|
| NUPLAZID | ~$1.0 billion USD |
| DAYBUE | ~$700 million USD |
| Combined | ~$1.7 billion USD |
This $700 million Daybue target is more than double what Culper predicted would be the drug's peak revenue of $316 million. The short thesis has been eviscerated.
What's Driving the Bullish Outlook?
Growing Patient Population: Acadia now estimates approximately 6,000 diagnosed Rett patients in the U.S., up from 5,500-5,800 previously - a 30% increase since Daybue's launch.
European Expansion: The $700M target assumes European regulatory approval. Acadia anticipates an EMA (European Medicines Agency) decision in Q1 2026 and estimates 9,000-12,000 patients in Europe.
New Formulation: DAYBUE STIX - a dye- and preservative-free powder formulation - was FDA approved in December 2025, with a broader launch planned for Q2 2026.
Japan Entry: Trofinetide trials have been initiated in Japan, opening a major Asia-Pacific market.
Additional Approvals: Daybue is now approved in three markets, including a recent Israel approval.
NEU Short Interest: How Shorts Built Their Position (And Got Crushed)
The short interest history tells a compelling story of how shorts piled in after the Culper report - and are now sitting on massive losses.
The Short Interest Timeline
| Period | Short Interest | What Happened |
|---|---|---|
| Jan 2024 | 0.30% | Pre-Culper: Minimal short interest |
| Feb 2024 (Culper Report) | 0.51% → 0.93% | Shorts piled in after the report |
| Apr 2024 | 1.66% | Position building continued |
| Jun 2024 | 2.69% | Shorts doubled down |
| Oct 2024 | 3.33% | Short interest tripled from Feb |
| Jan 2025 | 4.76% | Peak bearish positioning |
| May 2025 | 6.42% | All-time high short interest |
| Jan 2026 | 5.76% | Current: 19x higher than pre-Culper |
Short interest exploded from 0.30% before the Culper report to a peak of 6.42% in May 2025 - a 21x increase in short positioning. Shorts were clearly betting Culper was right.
Current Short Position
| Metric | Value |
|---|---|
| Short Interest | 5.76% |
| Short Shares | 7.29 million |
| Short Liability | $140.7 million AUD |
| Rank | #37 most shorted on ASX |
| Report Date | January 7, 2026 |
With nearly $141 million in short liability, there's significant capital betting against NEU's continued rise.
Price Performance vs Shorts
| Metric | Value |
|---|---|
| Current Price | $19.30 |
| 52-Week High | $22.99 |
| 52-Week Low | $8.61 |
| 12-Month Return | +61.4% |
| Market Cap | $2.44 billion |
The stock has more than doubled from its 52-week low and is up over 60% in the past year. Short sellers who piled in after the Culper report have been punished severely.
The Pain Trade
Here's where it gets brutal for shorts:
- Shorts who entered at 0.5% (Feb 2024) after the Culper report: Stock is up ~60% since then
- Shorts who entered at peak 6.4% (May 2025): Stock is up from lows near $8.61
- Q2 2024 sales beat crushed the "declining sales" narrative
- 76% patient retention demolished the "poor retention" thesis
- $700M 2028 target just obliterated the "$316M peak" claim
Management's $50M Vote of Confidence
While short sellers were piling in, Neuren's management made a bold counter-move: they launched a $50 million on-market share buyback in November 2024 - right as short interest was approaching its peak.
The Buyback Details
| Metric | Value |
|---|---|
| Total Shares Bought Back | 4,076,150 shares |
| Total Consideration Paid | $49,998,630.36 AUD |
| Average Price Paid | ~$12.27 |
| Highest Price Paid | $14.23 (30 May 2025) |
| Lowest Price Paid | $9.79 |
| Shares Cancelled | Yes - permanently removed from issue |
Source: Neuren Final Buyback Notification
The timing couldn't have been more telling. Short interest hit its all-time high of 6.42% in May 2025 - the exact month the company paid its highest buyback price of $14.23. Management was aggressively buying shares even as shorts pushed their positions to record levels.
Why This Matters
When management deploys $50 million to buy back their own shares while short sellers are betting against the company, it sends a powerful signal:
- Management Conviction: They were putting shareholder capital where their mouth is, betting the stock was undervalued
- Direct Counter to Shorts: Every share bought back is a share that must eventually be covered by a short seller
- Value Creation: With shares now trading at $19.30, those shares bought at an average of $12.27 are worth 57% more
- Reduced Float: Over 4 million shares permanently removed from the market means short sellers face a tighter market when covering
The company cited "stable cash inflow from sales of its Rett syndrome drug, DAYBUE" as the rationale - exactly the revenue stream that shorts claimed was a "total flop".
The Squeeze Thesis
Neuren presents an interesting squeeze setup:
Factors Favouring a Squeeze:
Fundamental Catalyst: Acadia's $700M guidance directly invalidates the core short thesis that Daybue was a "total flop" with limited revenue potential.
Short Interest Still Elevated: At 5.76%, shorts remain active despite being proven wrong on the fundamentals.
Strong Momentum: +61% in 12 months shows persistent buying pressure.
High Beta: NEU has a beta of 1.85, meaning it moves nearly twice as much as the market on any given day. Good news could spark an amplified rally.
European Catalyst Pending: EMA decision expected in Q1 2026 could be the trigger for the next leg up.
Key Metrics
| Metric | Value |
|---|---|
| P/E Ratio | 16.93 |
| P/B Ratio | 7.43 |
| EPS | $1.14 |
| Beta | 1.85 |
Culper's Track Record: The Power of a Story (Even a Wrong One)
The Neuren saga illustrates a crucial market lesson: a story doesn't have to be true to move markets - it just has to be believed.
Despite the report's claims later being proven wrong, it worked. People believed it. The stock plunged 14% on the day of the report. Short interest exploded from 0.3% to over 6% as investors piled in, convinced by the narrative.
Culper crafted a bearish story with emotive language ("total flop", "horror stories about adverse effects") that created genuine fear. Even though the claims were junk, they had real impact:
- Neuren shareholders lost millions in a single day on unsubstantiated claims
- Shorts raised their positions 21x betting the narrative was true
- The fear lingered for months even as sales data proved the claims wrong
The Neuren/Acadia report was later criticized by investors who pointed out:
- Emotive language designed to create fear rather than inform
- Lack of verifiable information supporting key claims
- Misleading arguments about patient retention data
- Cherry-picked data that ignored positive trends
- Hyperbolic claims like "total flop" that were easily disproven by subsequent sales
The report was described by some analysts as "low quality and opportunistic" - but that didn't matter in the moment. The story was compelling enough that people believed it, traded on it, and lost money on it.
The lesson for investors: A short seller report doesn't need to be accurate to crater your stock. It just needs to tell a scary story convincingly enough that people sell first and ask questions later. Always verify the claims against actual data - Culper's $316M peak prediction looked authoritative until Acadia announced they're actually targeting $700M by 2028.
What to Watch
Near-Term Catalysts
Q1 2026 EMA Decision: European regulatory approval could open a massive new market.
DAYBUE STIX Launch: Broader availability of the new formulation in Q2 2026.
Japan Expansion: Trial progress could unlock Asia-Pacific market.
Quarterly Sales Updates: Each beat would further validate the bull case.
Risk Factors
Single Drug Concentration: NEU is heavily reliant on Daybue royalties.
Partner Dependency: Acadia controls commercialization; NEU receives royalties.
Regulatory Risks: European or Japanese approval delays could impact timelines.
Competition: The rare disease space could see new entrants.
Conclusion: Shorts Running Out of Road
The Culper short thesis on Neuren has been systematically dismantled:
- They predicted $316M peak sales → Acadia is targeting $700M by 2028
- They claimed poor patient retention → 76% remain on therapy at 6 months
- They said Daybue was a "total flop" → Sales continue to grow
With 5.76% short interest still outstanding, the stock up 61% in a year, and major catalysts on the horizon (European approval, Japan trials, new formulation launch), Neuren has the ingredients for a squeeze if shorts are forced to capitulate.
The shorts bet against a Rett syndrome treatment that's helping thousands of patients. As Acadia's sales guidance shows, they appear to have bet wrong.
Disclaimer: This blog post is for informational and educational purposes only and is not financial advice. The information provided is based on data available as of 2026-01-14. Neuren Pharmaceuticals is a biotech stock with inherent risks including regulatory uncertainty and single-product concentration. Short selling data reflects positions as of the report date and changes daily. You should conduct your own thorough research and consult with a qualified financial professional before making any investment decisions. ASXShort.app does not guarantee the accuracy or completeness of the data presented, nor does it guarantee future stock performance.
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