Shares are skyrocketing at Proteostasis $PTI, a small biotech in Cambridge, MA, following news that regulators handed out breakthrough status to the company’s cystic fibrosis therapy.
The good news follows positive data announced last year for the company’s first-in-class CFTR amplifier, and a $50 million IPO just before that.
The drug, called PTI-428, is meant to boost levels of the CFTR protein, which is lacking in cystic fibrosis patients. The therapy is an add-on treatment for patients with the F508del mutation in the CFTR gene who are already taking an approved CFTR modulator or as part of Proteostasis’ triple combo regimen that includes PTI-808, a potentiator, and PTI-801, a corrector.
This new designation was given out based on data from a recent Phase II study including 24 CF patients with the F508del mutation taking Vertex’s drug Orkambi.
“We believe the breakthrough therapy designation for PTI-428 reflects the strength of the recent Phase II study results for our amplifier, a novel and proprietary class of CFTR modulators,” said Meenu Chhabra, president and CEO of Proteostasis, in a statement. “PTI-428 can potentially be added to current and future standards of care, offering the potential for improvement in pulmonary function for patients with cystic fibrosis.”
Analysts at Baird Equity Research were positive on the news, but acknowledged investors’ skepticism that a breakthrough status could be meaningful to stock performance.
“We acknowledge that breakthrough designation has turned out to be much less of a validation of a drug’s benefit than many hoped for when it started in 2012,” wrote analyst Brian Skorney in a research note this morning. “However, for a ~$100 million market cap company where many investors just don’t believe the data, we think it likely provides a materially higher degree of confidence in the results of the Phase II study, with the understanding that the FDA doesn’t put a ton of diligence into verifying the strength of results that are the basis of breakthrough therapy designation. While not an exhaustive list, a skim indicates that most of the drugs granted breakthrough designation do seem to have meaningful clinical impact.”
Proteostasis’ stock is up 52% in pre-market trading, going for $6.29 per share at time of publishing.
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