Shares of Paratek Pharmaceuticals (NASDAQ:PRTK) rose over 16% Thursday after announcing financial results for the first quarter of 2017 and giving investors a regulatory timeline for its lead drug candidate, which, in April, achieved positive phase 3 results for treating community-acquired bacterial pneumonia with an intravenous formulation. An oral formulation of the drug candidate, omadacycline, is also being evaluated in a phase 3 trial for treating acute bacterial skin and skin-structure infections.
Most importantly for investors, management now believes that it can submit a New Drug Application for each formulation to the U.S. Food and Drug Administration as early as the first quarter of 2018, which is one quarter earlier than previous expectations. As of market close, the stock had settled to a 14.8% gain.
It goes without saying that submitting an NDA earlier could result in earlier potential marketing approval. Moving up the timeline for potential product sales is especially important for a pre-revenue company such as Paratek Pharmaceuticals. But investors are likely aware that the biopharma company has been on a roll lately throughout its pipeline. Other highlights include:
- The company announced, together with Allergan, positive phase 3 results for two studies evaluating sarecycline as a treatment for acne. Allergan expects to file an NDA in the second half of 2017.
- Paratek announced a collaboration with Zai Lab to commercialize omadacycline in China.
- It announced positive phase 1 results for omadacycline showing encouraging pharmacodynamic activity in the lungs of patients with community-acquired bacterial pneumonia. In other words, the company has more data providing evidence to support future expanded use of the drug candidate in additional diseases and conditions.
Thanks to a flurry of news in the last several months, it should be no surprise that Paratek Pharmaceuticals stock has risen over 50% year to date.
Long-term investors appear to have a winner on their hands with Paratek Pharmaceuticals, especially at a market cap of around $600 million. The only bad news is that investors have to wait at least one year before revenue arrives, assuming sarecycline and omadacycline are approved. Even then there could be some uncertainty regarding the initial performance of the products. Then again, that's much better than dealing with the uncertainty that comes from failed clinical trials.