Why Global Blood Therapeutics Skyrocketed Today

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What happened

In response to data from a phase 3 study and a regulatory update, Global Blood Therapeutics (NASDAQ: GBT), a clinical-stage biotech focused on blood disorders, saw its shares vault 38% as of 11:07 a.m. EST Monday.

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So what

Global Blood Therapeutics provided investors with a preliminary update from its phase 3 HOPE study. This 154-patient trial is testing its drug Voxelotor as a treatment for kids with sickle cell disease. The 24-week study showed that Voxelotor demonstrated sustained improvements in hemoglobin levels and measures of hemolysis with good safety data.

What's more, the data was so encouraging that the Food and Drug Administration has agreed to accept the company's request to put Voxelotor on an accelerated-approval pathway as a treatment for sickle cell disease.

Traders cheered the positive clinical and regulatory updates.

So what

Today's update should give investors increased confidence that Voxelotor is the real deal. That's good news since the drug could easily pull in hundreds of millions of dollars annually if it wins approval.

Investors who buy Global's stock today are still assuming a lot of regulatory and commercial risk, but they could be handsomely rewarded if everything goes according to plan.

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Brian Feroldi has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.