Investors hungry for stocks that can make big moves in a short amount of time know the biotech industry is the best place to look. A new drug approval, or simply clinical trial results that suggest success can push small-cap stocks through the roof. 

Recently, Cara Therapeutics (CARA -5.02%)Enanta Pharmaceuticals (ENTA -1.75%), Ocugen (OCGN -5.60%) made big moves in the right direction. Here's a look at the reasons they climbed higher to see if they can put up larger gains down the road.

Biotech investor with lots of screens to look at.

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1. Cara Therapeutics

Shares of Cara Therapeutics have been up and down since the company earned approval for its first drug this August. The stock began surging again recently, rising around 33% during the last week of October even though there wasn't any news from the company.

Cara Therapeutics lead drug, Korsuva is an interesting new opioid that earned FDA approval earlier this year to reduce itching associated with hemodialysis treatment. It's too early to predict profits because Cara Therapeutics and its dialysis clinic partners don't intend to launch Korsuva until next year.

The FDA only approved an intravenously injected version of Korsuva and this isn't a viable drug delivery method for relatively healthy eczema patients. Sales to the hemodialysis crowd are expected to be somewhat limited so investors have their sights set on a much larger population of people with atopic dermatitis, or eczema.

Cara Therapeutics stock crashed in April when an oral version of Korsuva failed to significantly reduce itching for eczema patients in a phase 2 trial after 12 weeks of treatment. The company is pressing on because a sub-group analysis suggests oral Korsuva could work for a more narrowly defined population of mild-to-moderate eczema patients who want to control itching.

Scientists with pipettes.

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2. Enanta Pharmaceuticals

This biotech stock gained more than 50% in October and its long-term shareholders are doing better still. Enanta Pharmaceutics shares have more than doubled since the beginning of 2021.

Enanta Pharmaceuticals discovers and develops antiviral drugs. Its lead revenue stream comes from AbbVie. The big pharma pays royalties on sales of its treatments for hepatitis C virus (HCV). Unfortunately, royalty revenue for HCV drugs isn't nearly enough to make ends meet and Enanta lost $54 million during the first nine months of 2021.

Investors have been driving Enanta Pharmaceuticals stock higher in anticipation of a new oral antiviral treatment the company is developing for COVID-19 patients. On Oct. 19, 2021, the company presented encouraging data for EDP-235, that drove the stock higher.

Sadly, Enanta Pharmaceuticals only has encouraging pre-clinical data for EDP-235. Trials with people aren't expected to begin until early next year. In the meantime, molnupiravir from Ridgeback Biotherapeutics and its big pharma partner Merck will probably become a well-known oral antiviral treatment for COVID-19. The partners already presented successful results from a phase 3 study and Pfizer isn't far behind with an oral antiviral COVID-19 treatment of its own.

Scientists talking in the laboratory.

Image source: Getty Images.

3. Ocugen

Shares of this biotech stock surged around 65% higher in October. Over the past year, hope for a COVID-19 vaccine from Ocugen's overseas partner has pushed the stock more than 4,000% higher.

Ocugen is a clinical-stage biotech without any new drug candidates in late-stage human trials. The company's only important asset at the moment is a co-commercialization deal for Covaxin. This is a COVID-19 vaccine developed by Bharat Biotech of India that probably won't ever generate a significant profit for Ocugen.

Another protein-based vaccine from Novavax already generated successful pivotal trial results. A long-delayed emergency use authorization request from Novavax is expected to reach the FDA by the end of the year.

Ocugen began the process for running clinical trials in the U.S. by submitting an investigational new drug (IND) application to the FDA, on Oct. 27, 2021. A planned phase 3 trial in the U.S. can't get started until that IND gets a green light, which could take months.

There's no telling when U.S. regulators here will begin to review an emergency use request from Ocugen. The FDA could simply use data from a successful pivotal trial Bharat Biotech completed in India. This seems highly unlikely because the agency doesn't need to bend over backward to speed up new vaccine development.

Johnson & Johnson, Moderna, and Pfizer have already provided the United States and Canada with more vaccine doses than they can handle. Since these are the only two territories included in Ocugen's agreement with Bharat Biotech, those commercialization rights probably aren't worth the paper they're printed on. It's probably best to watch this company's story play out from a safe distance.