Praxis Plunges 13.33% as Surging $430M Volume Ranks 282nd Amid Short Report Fallout

Market Snapshot

, 2025, marking one of its steepest declines in recent months. , , and ranked 282nd in volume among U.S.-listed equities. Despite the sharp drop, , reflecting its volatile trajectory amid speculative momentum tied to its experimental drug, . The decline followed a critical short report from Culper Research, which questioned the validity of Praxis’ Phase 3 trial data for its essential tremor treatment.

Key Drivers

The short report from Culper Research emerged as the primary catalyst for Praxis’ selloff, alleging systemic flaws in the company’s clinical data. The report accused Praxis of “engineering” positive results through methodological changes, including an unapproved last-minute endpoint modification and optimistic assumptions for patients who discontinued the trial. Culper further claimed the company’s analysis contradicted its cited research and that the FDA would likely reject the application. The report’s credibility was bolstered by consultations with former Praxis directors, biostatisticians, and FDA officials with decades of experience. These allegations directly undermined confidence in the drug’s regulatory prospects, triggering a sharp sell-off.

A second key factor was the drug’s troubled development history, which the short report highlighted to question its intrinsic value. , a price Culper argued signaled its lack of promise after prior owners abandoned it. The report also noted that three other drugs with the same mechanism had failed in early-stage essential tremor trials. Despite these red flags, Praxis advanced ulixacaltamide to Phase 3 even after an independent data monitoring committee recommended halting the trial in March 2025 for futility. This decision, , raised concerns about its efficacy and tolerability.

The short report also criticized Praxis’ capital-raising activities following the October 2025 announcement of “positive” Phase 3 results. , which Culper framed as a misallocation of resources given the alleged fragility of the data. , , leaving the stock vulnerable to regulatory setbacks.

Retail and institutional sentiment shifted rapidly after the report’s release. While Praxis had maintained a bullish retail sentiment on platforms like Stocktwits prior to the report, . Culper predicted that the FDA would recognize the data’s flaws during Praxis’ fourth-quarter 2025 pre-NDA meeting, leading to significant downside risk. The report’s claims, combined with the company’s lack of immediate public response, amplified market uncertainty.

The broader implications for Praxis hinge on the FDA’s review of ulixacaltamide. If the agency aligns with Culper’s critique, the drug’s approval prospects—and the company’s valuation—could collapse. Conversely, a favorable outcome would validate Praxis’ strategy and justify its current market capitalization. For now, the stock’s sharp correction underscores the fragility of biotech valuations tied to single-product pipelines, particularly when clinical data face rigorous scrutiny.