Cerevel Therapeutics (CERE) a small-cap bio with an interesting spread on 5/5 that saw 2,000 August $35 calls bought for $4.50 with the June $30 calls sold for $3.20 to open, expecting data in the 2H for their epilepsy treatment. CERE had 1000 May $45 calls sold in January but otherwise no notable open interest. The $4.92B biotech focuses on development of various therapies for neuroscience diseases including Schizophrenia, Parkinson’s, anxiety, dementia-related apathy and epilepsy. The company has $618M in cash on hand, enough to fund operations into 2024. They have a busy slate in 2023 with Phase 3 readouts in Parkinson’s but in late 2022 they expect Phase 2 data for darigabat for the treatment of epilepsy. The treatment selectively targets the GABA receptor within the brain with goal of making convulsions more tolerable with reduced abuse tendencies. CERE sees the treatment becoming the 1L therapy for epilepsy, a market with 65M patients worldwide and a $6B market growing at 6-7% annually. Darigabat has been showing favorable results in both efficiacy and safety with only mild AEs relative to benzodiazepines. The current trial is intended to establish proof of concept and tolerability profile to support development in broader epilepsy indications. Goldman started coverage at Neutral in February as they think more focus is on the 2023 readouts and assets. JP Morgan with an Overweight rating and $50 PT as they note Cerevel is ambitiously targeting notoriously difficult indications across neuroscience and their broad pipeline offers both enhanced optionality and a potential steady stream of catalysts over the next couple years. HCW has a $50 PT. They note that while Cerevel’s assets use novel mechanisms, it has chosen well-validated targets, which gives strong confidence in success.