Shares of PhaseBio Pharmaceuticals (NASDAQ: PHAS) jumped over 32% today after the company made two major announcements about its suddenly busy drug pipeline.
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First, PB2452 received Breakthrough Therapy designation from the U.S. Food and Drug Administration, which will help to speed its development and potential commercialization. Second, PhaseBio Pharmaceuticals issued a global license to ImmunoForge for PB1023 in sarcopenia-related diseases (read: age-related muscle loss) but will retain the rights to develop the drug for diabetes, obesity, and fatty liver disease indications.
PhaseBio Pharmaceuticals has now gained 380% since the start of 2019. As of 2:14 p.m. EDT, the stock had settled to a 17% gain.
Receiving FDA Breakthrough Therapy designation is a big deal for PB2452. The label is granted to drug candidates that demonstrate significant improvements over standard therapies in early-stage clinical trials and provides expedited regulatory review. Breakthrough therapies can even launch onto the market in a limited capacity while phase 3 trials are underway.
The drug is being developed to reverse the antiplatelet effects of the blood thinner Ticagrelor. In plainer terms, individuals take Ticagrelor to reduce the risk of blood clots, but they bleed more easily, which can make injuries or surgeries life-threatening scenarios. In a phase 1 trial, PB2452 demonstrated the ability to safely and immediately reverse the blood-thinning effects of Ticagrelor.
Meanwhile, financial terms for the licensing deal involving PB1023 weren't disclosed, but it should provide important nondilutive capital to PhaseBio Pharmaceuticals and suggests its technology platform has promising market potential.
A few short weeks ago, PhaseBio Pharmaceuticals sported a market cap of just $80 million. Today the company is valued at more than $350 million. Whether or not the stock can hold onto its recent gains depends on continued progress in the clinic. Considering the business reported an operating loss of $19 million in 2018 but ended the year with roughly $61 million in cash and cash equivalents, it may not need to raise additional capital for the foreseeable future. In the meantime, all eyes will be on the development of PB2452, which figures to be the drug candidate closest to hitting the market.
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