Axsome Biotherapeutics announced that the US regulator has granted Priority Review to its investigational therapy for agitation associated with Alzheimer’s disease, a decision that prompted a sharp rise in the company’s share price as investors priced in faster regulatory timelines and expanded commercial potential.

The Priority Review designation from the US Food and Drug Administration shortens the standard review period, reflecting the agency’s view that the therapy may offer meaningful improvements over existing options for a condition with significant unmet medical need. Agitation affects a large proportion of people living with Alzheimer’s disease and places substantial emotional and economic strain on patients, caregivers, and healthcare systems.

Axsome stated that the accelerated pathway validates both the clinical data generated to date and the broader potential of its central nervous system focused pipeline. The company believes the therapy could address a critical gap in dementia care by providing a targeted, evidence based option for managing agitation without the limitations seen in many current treatments.

Market reaction was swift, with Axsome shares posting notable gains in early trading following the announcement. Analysts highlighted the Priority Review as a de risked regulatory step that could strengthen Axsome’s competitive positioning in the neuropsychiatric and neurodegenerative space, while also improving visibility on potential launch timelines should approval be secured.

If approved, the therapy would position Axsome to enter a sizeable and growing market, as ageing populations worldwide drive rising prevalence of Alzheimer’s disease and related behavioural symptoms. The company noted that it continues to engage closely with regulators as the review progresses and remains focused on advancing therapies that deliver tangible benefits to patients and caregivers.