What happened

After Momenta Pharmaceuticals (MNTA)  reported positive results from a phase 1 trial for its M281 candidate treatment, its shares rose sharply Friday, trading 15.6% higher as of 1:51 p.m. EST. 

So what

Momenta's M281 treatment is an anti-FcRn monoclonal antibody that's engineered to reduce circulating pathogenic IgG antibodies by completely blocking endogenous IgG recycling via FcRn. The company believes that approach could eventually position it as a best-in-class option for use in immune-mediated disorders.

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According to the advocacy group AARDA, 50 million Americans suffer from auto-immune disorders, many of which are characterized by the formation of autoantibodies that can activate immune cells and cause tissue inflammation and damage. In phase 1 trials, M281 was found to be safe and generally well-tolerated at all dose levels tested and it delivered a greater than 80% reduction in circulating IgG antibodies.

The news paves the way for the company to finalize its development strategy, and initiate a proof-of-concept clinical trial in the second half of 2018.

Now what

Even an early-stage trial success is good news for investors, who have watched shares slump this fall following news that Mylan (MYL) won FDA approval for a 40 mg, long-lasting version of the multiple billion dollar drug, Copaxone. As a refresher, Momenta and Novartis (NVS -0.87%) jointly market Glatopa, a 20 mg, once-daily version of Copaxone. Glatopa's sales have been slipping as more patients shift to the long-acting alternative, and in Q3, 2017, Glatopa revenue fell 53% year over year to $10.9 million.

Momenta and Novartis' plans to launch their own 40 mg version have been delayed by fill-and-finish problems that have kept the FDA from issuing an approval decision. 

The potential addition of M281 to Momenta product lineup someday is particularly intriguing because autoimmune disorders represent some of the biggest markets in biopharma. However, investors should remember that M281 is in the very early stages of development, so it will be a while before we have data that can provide a clearer picture of its market opportunity.