Anyone holding shares of Acadia greatly benefitted, as the biotech more than doubled -- up over 140 percent at one point.
The study met its primary endpoint, as patients who received the drug had their symptoms reduced by more than one-third.
Thus far, there has been no timeline given for when the company will submit its drug to the FDA for approval.
Despite the gain on Tuesday, long-term shareholders may still be underwater on their positions. In 2008, Acadia was trading above $10 per share. Then, disappointing results lead to a steep selloff. The market crash in late 2008 may have contributed, but unlike most other stocks, Acadia has barely recovered from the market bottom.
Overall, 2012 has been a great year for biotechs. The SPDR Biotech ETF (NYSE: XBI), for example, is up well over 30 percent this year.
Vivus (NASDAQ: VVUS) received approval on its weight loss drug earlier in the year, sending shares into the stratosphere. However, the stock gave up much of its gains in the second half of the year, as weak sales pressured the company. Still, year-to-date, shares are up over 17 percent.
Arena Pharma (NASDAQ: ARNA), on the other hand, is up a staggering 397 percent so far this year. Like Vivus, the company has rallied on its obesity drug.
But, just indiscriminately buying biotechs in January and holding them throughout the year wouldn't have been wise; a few biotechs have posted abysmal returns in 2012.
Questor (NASDAQ: QCOR), for example, is down over 30 percent this year. From its highs of the year, it's down almost 50 percent. There was concern that Questcor's primary drug, Achtar,would face intense competition.
Still, there is no doubt that the biotech sector has been one the big winners of 2012. Acadia's move on Tuesday is just another example of that fact.
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