Arena Pharmaceuticals, Inc. ARNA shares are on a roll on Tuesday, rising by about one-half on over 10 times their average volume. The stock is now trading at its highest level in nearly two years.
For those keen to the know the reason behind the jump, here are the details.
Catalyst
Arena announced Monday after the close that its investigational candidate Ralinepag, meant to treat pulmonary arterial hypertension, produced positive results in a mid-stage trial.
Ralinepag is a long-acting, orally administered prostacyclin receptor agonist.
Incidentally, on July 7, JMP analyst Jason Butler upgraded his rating on Arena shares to Market Perform, with a 27 price target, citing his belief that the stock's current valuation under appreciates the potential clinical and commercial success of Ralinepag and strasimod in ulcerative colitis.
ARNA Source: Y Charts
Trial Results
The results of the phase 2 study revealed that Ralinepag met the primary endpoint of statistical significant absolute change from baseline in pulmonary vascular resistance, or PVR compared to placebo. It also demonstrated numerical improvement in six-minute walk distance, or 6MWD.
"Patients treated with Ralinepag had a 29.8% improvement in PVR compared to the placebo arm (P=0.03) and a 20.1% improvement in PVR compared to baseline," the company said.
The phase 2 study was a randomized, double-blind, placebo-controlled, dose-ranging study in 61 adult patients with PAH, WHO/NYHA functional class II-IV.
On the safety parameter, the company said adverse events observed in the study were consistent with other prostacyclin treatments for the management of PAH, with headache, nausea, diarrhea, jaw pain and flushing.
The company said it plans to present the full study results at future medical conferences.
It is exciting to see the positive nonclinical pharmacological profile translating into potentially the first oral prostacyclin therapy that may approach consistent therapeutic levels without the complexity of parenteral (IV) therapy. These data give us confidence to move expeditiously toward a Phase 3 clinical program," stated Preston Klassen, executive vice president, R&D and chief marketing officer of Arena.
At the time of writing, shares of Arena were surging 49.71 percent to $27.53.
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