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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of biotechnology company XenoPort (Nasdaq: XNPT ) shot up by as much as 12% earlier in the trading session, following the release of phase 1 clinical results for its oral relapsing-remitting multiple sclerosis treatment, XP23829.
So what: Results from XenoPort early stage trial were generally favorable, well tolerated by the 60 tested patients, and leads to a possible indication of a higher dose of the drug hopefully being used as a once-a-day treatment. XP23829, which is a fumaric ester compound, has shown positive neuroprotective effects in preclinical models, but today’s data release is the first step towards potential commercialization.
Now what: Before we get too excited, let’s keep in mind that this is merely an early stage trial, and XenoPort still has a lot to prove with regards to efficacy in mid-stage trials. The bigger concern with XenoPort, as I addressed two weeks earlier, has to do with its current FDA-approved restless leg syndrome treatment, Horizant. Sales of the drug have been laughably weak, with U.S. marketing partner GlaxoSmithKline (NYSE: GSK ) recording only $1.3 million in sales in its most recent quarter. If XenoPort doesn’t address its immediate weakness with Horizant, I’m not certain that early stage data like we saw today will be enough to buoy its lofty valuation.
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