What happened

Shares of BioCryst Pharmaceuticals (NASDAQ:BCRX) were soaring 16.8% higher as of 11:44 a.m. EST on Friday. The big jump came after the drugmaker announced Food and Drug Administration (FDA) approval of Orladeyo (berotralstat) to prevent hereditary angioedema (HAE) attacks in adults and children ages 12 and up.

So what

Was the size of today's gain justified? Probably so. Orladeyo could potentially generate peak annual sales in the ballpark of $500 million. BioCryst's market cap stood at close to $900 million before the FDA approval was announced.

Hands holding card with "FDA Approved" printed on it

Image source: Getty Images.

There are other FDA-approved HAE drugs on the market. However, Anthony Castaldo, CEO of the U.S. Hereditary Angioedema Association, noted that Orladeyo is "the first orally administered non-steroidal option for preventing HAE attacks." He added that the approval of the drug "represents an important and welcome step in making more treatment options available to physicians and patients."

The FDA's approval decision was based on overwhelmingly positive results from a late-stage study of Orladeyo. Patients receiving the drug experienced a significant reduction in HAE attacks at 24 weeks with the improvement carrying over through 48 weeks.

Now what

BioCryst has already built a sales team ready to launch Orladeyo in the U.S. market. What's the next potential catalyst for the biotech stock? The company expects two other key approvals for its HAE drug soon: Japanese regulators should make an approval decision this month, and the European Medicines Agency could approve Orladeyo early in 2021.

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