Shares soar as ‘breakthrough’ news in biotech continues to run hot this week
The FDA has been working overtime this week handing out new breakthrough therapy designations for a whole slate of biotech drugs in the clinic. But five years after the program was launched, investors are still ready to cheer on each announcement with a big spike in stock prices.
Waltham, MA-based Proteon Therapeutics nabbed a BTD for vonapanitase for increasing arteriovenous fistula secondary patency (survival of the fistula without abandonment) and use for hemodialysis in patients on or expected to initiate hemodialysis. Its stock $PRTO surged 23% on the news Wednesday.
This morning it was Synthetic Biologics’ turn. The FDA handed it a BTD for SYN-004 (ribaxamase), which is designed to protect the gut microbiome from the havoc caused by some antibiotics and guard against Clostridium difficile infection. The Rockville, MD-based biotech said that after the Phase IIb trial came up with positive data, regulators were ready to give it a BTD and an open door to regulators who can help speed this to an approval. Their stock $SYN jumped 40% in pre-market trading, but it’s a penny stock after the company issued a huge number of shares last fall, so a big spike is still just worth pennies a share.
Boston-based Rhythm landed a second BTD for setmelanotide, the company’s melanocortin-4 receptor (MC4R) agonist. The expanded BTD is for the treatment of obesity associated with genetic defects upstream of the MC4 receptor in the leptin-melanocortin pathway. The FDA had previously granted BTD to setmelanotide for the treatment of POMC deficiency obesity. Rhythm is a private company.
Corbus Pharmaceuticals $CRBP earlier this week, meanwhile, said that it did not get a BTD for its anti-inflammatory anabasum, as they had requested, making it one of the few biotechs that have gone after the designation and publicly admitted when it didn’t come through. But plenty of others are landing new or improved BTDs, which could help reduce the time it takes to get a new drug through the clinic and on to a potential approval.