AcelRx Pharmaceuticals Inc (NASDAQ:ACRX) Is Already Rewarding Our Readers

Back on July 6, we highlighted AcelRx Pharmaceuticals Inc (NASDAQ:ACRX) as one to watch in our Biotech Catalyst series. The company was trading in and around $2 a share at the time, having spent the three months prior slowly but surely losing strength.Our argument was simple: that this stock was dramatically undervalued both versus its peers and when considered against a backdrop of its pipeline (in terms of stage of development and forward potential). In turn, we suggested that it could only stay this cheap for so long and that (and here's what qualified it for inclusion in our Biotech Catalyst series) a couple of key near term events could spark the revaluation we were expecting.Fast forward a few weeks and things are well on their way.A couple of other analysts have picked up on this potential subsequent to our coverage, one here and another here.With each extra bit of coverage this stock gets it steps a little bit further into the spotlight and a becomes a little less under the radar. Traders are loading up ahead of the catalysts we highlighted at the start of the month in anticipation of a near term revaluation and this loading is resulting in some pre-release strength.AcelRX will open the session on Tuesday at $3.20 a piece. That's a 60% premium on the price at we first highlighted this one and this is before the catalysts even hit press. If the releases come out as favorable, this 60% run is going to be the start of something much bigger.Of course, if things don't run as smoothly as the company hopes, this one's going to sell off. And that's what's key to this discussion right now – a revamped risk profile. The first catalyst should hit press any day now and it's data from an ongoing phase 3 study of a pain management drug called Zalviso. As we noted last time, this is likely going to prove the less impactful of two catalysts, with the second being a PDUFA in October for another pain management drug called DSUVIA.Back at the start of the month, there was high double digit upside potential on positive data from the former of these two drugs. With a 60% run over the last couple of weeks, this return potential is trimmed down substantially, while the risk side of the equation remains in place. This isn’t to say that there's no justification for an exposure at current prices – far from it – but just that the latest run puts considerably more focus on the second, October, catalyst s a long term revaluation driver than was initially the case when we first highlighted this stock as one to watch.So what's the takeaway here?Well, this remains a key stock in our Biotech Catalyst series and could still serve up a considerable return for any readers that missed our first coverage and are thinking about picking up an exposure to the near term catalysts at current rates. The initial data should hit press this week (we wouldn’t be surprised if the company releases it today, given the recent uptick in volume) and – however it turns out – we'll then be looking at the October PDUFA to either compound the upside action that kicked off at the upcoming release or, alternatively, help this one recover from any lost strength brought about on the back of weak near term data.As a side note, and one that serves to minimize risk on the upcoming data, it's worth mentioning that the drug in question is already approved in Europe. While this doesn’t confirm strong data from the US phase III, it would be unusual for a drug that's already performing off the shelves to miss in a late stage trial like the one that's ongoing.Let's see what happens…Check out our previous coverage of this one here. We will be updating our subscribers as soon as we know more. For the latest updates on ACRX, sign up below!Image courtesy of Greg Adams via FlickrDisclosure: We have no position in ACRX and have not been compensated for this article.