What happened
Shares of BioChryst Pharmaceuticals (BCRX -1.75%) jumped 14.7% this week, according to data from S&P Global Market Intelligence. The stock opened Monday at $10.40 a share and climbed to its weekly high at $12.76 on Wednesday. The stock has a 52-week low of $10.13 and a 52-week high of $19.99.
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So what
BioChryst focuses on oral small-molecule enzyme therapies to treat rare diseases. The company has two marketed therapies, Orladeyo (berotralstat) and Rapivab (peramivir). Orladeyo is used to prevent attacks of hereditary angioedema, a type of swelling in the deeper layers of skin, often around the face and lips, in adults and children 12 years of age and older. Rapivab is a flu antiviral. BioChryst also has several ongoing drugs in trials.
The stock was in bounce-back mode after it fell on Friday following the company's announcement it was halting three clinical trials of its pipeline candidate BCX9930 while it studies rising levels of the amino acid creatine in some patients. Rising levels of creatine can be unsafe for some people with kidney conditions. The drug is being looked at as an oral Factor D inhibitor to treat several complement-mediated diseases, primarily paroxysmal nocturnal hemoglobinuria (PNH), a rare blood disease that can cause thrombosis, intravascular hemolysis (the premature destruction of red blood cells), and bone marrow failure.
Now what
Biotech stocks can be risky, but at least this one seems to be on a path of increased revenue and eventual profitability. The bad news led to some panic selling and within a few days, the market corrected. While the pause is reason for concern, the decision was made by BioChryst, not the Food and Drug Administration (FDA), and doesn't necessarily mean that the therapy is unsafe, but that the dosage may have to be adjusted. While BioChyrst further examines the results, it has several other pipeline candidates in the works. Orladeyo has been a big success since its launch at the end of 2020. Last year, the company reported revenue of $157.2 million, up from $17.8 million in 2020. The bulk of the increase was due to $122.6 million in net revenue from Orladeyo plus increased Rapivab revenue.
The company isn't turning a profit yet, but with Orladeyo's revenue growing, it went from an earnings-per-share (EPS) loss of $1.09 per share in 2020 to an EPS loss of $1.03 last year. That number would have been better were it not for increased expenses surrounding the launch of Orladeyo. The company said it expects at least $250 million in revenue this year.
