Shares of the commercial stage pharmaceutical company Siga Technologies (SIGA 0.64%) are on fire Monday. Specifically, the drugmaker's stock was up by a hefty 23%, on higher-than-normal volume, as of 10:28 a.m. ET Monday morning.
What's sparking this double-digit gain? Siga's stock is bolting higher in response to the World Health Organization's decision to declare the ongoing monkeypox outbreak a global health emergency. To date, there have been over 16,000 cases of monkeypox across 75 countries.
Siga's Food and Drug Administration (FDA)-approved smallpox medication, known as Tpoxx (generic name: tecovirimat), was previously approved as an oral treatment for monkeypox in the United Kingdom and Europe. The company, in turn, will likely see a sizable surge in demand for this antiviral medication overseas. In fact, Siga already reported a significant uptick in orders for the drug from multiple international jurisdictions last month.
In the U.S., Tpoxx also may also end up being used against the monkeypox outbreak. But such a move is far from certain. As things stand now, the drug can only be prescribed for monkeypox in the U.S. on a compassionate basis. Unfortunately, this rather stringent regulatory pathway is insufficient to deal with a full-on epidemic.
Is Siga's stock still a red-hot buy? Given the unpredictable nature of U.S. regulatory agencies in emergency situations such as this one, investors may want to take a cautious approach with this speculative monkeypox play right now. Siga's shares, after all, are now trading at an all-time high after today's latest move northward.