Market Overview

Here's Why Arena Pharmaceuticals Jumped 30% Today

Here's Why Arena Pharmaceuticals Jumped 30% Today

Arena Pharmaceuticals, Inc. (NASDAQ: ARNAannounced an encouraging update on etrasimod, its drug candidate for the treatment of autoimmune diseases like ulcerative colitis.

What Happened

Arena Pharmaceuticals reported topline Phase 2 results from an ongoing trial of etrasimod called OASIS after Monday's market close. Patients suffering from ulcerative colitis who received a 2 mg dose of etrasimod saw statistically significant improvement in three categories:  stool frequency, rectal bleeding and endoscopy findings. 

The proportion of patients who achieved clinical remission was 33 percent in the etrasimod 2 mg group as opposed to 8.1 percent for the placebo group. Overall, etrasimod was well tolerated and there were fewer patients who encountered any serious adverse events compared to a placebo. The impact on heart rate and atrioventricular conduction was low throughout the study, with no discontinuations from study related to bradycardia or AV block.

Why It's Important

"Along with the positive Phase 2 results for ralinepag reported last year, this important milestone for the company further amplifies our conviction in Arena's internally discovered and developed compounds and their potential to be best-in-class," said Preston Klassen, Arena's executive vice president for research and development and chief medical officer. 

Investors appear to be cheering the Phase 2 results, as Arena's stock was trading higher by more than 30 percent after Tuesday's market open. 

What's Next

Arena Pharmaceuticals will present complete study results at future medical congresses. The Phase 2 data is supportive enough for the company to proceed to a Phase 3 program in ulcerative colitis, Klassen said.

Related Links:

Regulatory Concern For Celgene's Ozanimod Could Be Big For Arena Pharma, Novartis

7 Biotech Stocks With Clinical Trial Outcomes In March

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