Catalyst Pharmaceuticals (NASDAQ: CPRX), an orphan drugmaker, gained a whopping 77% last month, according to data from S&P Global Market Intelligence. What sparked this breakout?
Catalyst's shares initially popped on the company's fourth-quarter earnings report on March 18. But the biotech's shares got a second major jolt from a corporate presentation at the Oppenheimer's 29th Annual Healthcare Conference on March 20.
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Taken together, the biotech's latest earnings release and corporate update helped to assuage investors' concerns regarding Firdapse's recent commercial launch. Firdapse was approved by the Food and Drug Administration as a treatment for the rare autoimmune disease Lambert-Eaton myasthenic syndrome (LEMS) in late 2018.
Firdapse's commercial debut in America was widely expected to be a flop by industry insiders. After all, this branded drug is basically a vastly more expensive version of a medicine known as 3,4-DAP that's been available for free to most patients for over 20 years.
Nonetheless, Catalyst was still able to transition a large number of 3,4-DAP users onto Firdapse during the first two months of 2019. This rapid adoption rate strongly supports the company's internal forecast that Firdapse could eventually generate between $300 million to $900 million in sales as a LEMS treatment.
Catalyst has big plans for Firdapse. Later this year, the drugmaker is scheduled to announce late-stage results for the drug in patients with congenital myasthenic syndromes and myasthenia gravis. And next year, Firdapse's proof-of-concept trial in patients with type 3 spinal muscular atrophy is also slated to produce top-line results. If all the stars align, this highly controversial orphan drug could turn out to be a blockbuster-level product. Catalyst's shares, in that case, might have a lot more room to run.
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