What happened

Shares of Intercept Pharmaceuticals (ICPT) were soaring 15.7% higher as of 12:02 p.m. ET on Tuesday. The big gain came after the drugmaker announced its third-quarter results before the market opened.

Intercept reported Q3 revenue of $77.6 million, up 16.5% year over year. The consensus Wall Street estimate was for revenue of $74.1 million. The company posted Q3 earnings of $267.5 million, or $7.80 per share. This reflected a significant improvement from the net loss of $3.6 million, or $0.11 per share, in the prior-year period. It also easily topped the average analysts' earnings estimate of $4.61 per share.

In addition, Intercept increased its full-year 2022 guidance for adjusted net sales of Ocaliva. The company now expects the primary biliary cholangitis (PBC) drug will make between $340 million and $350 million, up from its previous outlook of $325 million to $345 million.

So what

Intercept's solid revenue growth was entirely due to higher Ocaliva sales. This performance is encouraging because it underscores the opportunity for the drug in the PBC indication.

On the other hand, the company's big earnings beat wasn't as impressive as it might seem at first glance. Intercept's bottom-line improvement stemmed entirely from the sale of its ex-U.S. business. Without the impact of this gain, the drugmaker would have posted a net loss of nearly $104.1 million, or $3.04 per share.

Now what

The biotech stock could have another positive catalyst on the way in the near future. Intercept plans to resubmit its New Drug Application (NDA) for U.S. approval of obeticholic acid (OCA) in liver fibrosis due to nonalcoholic steatohepatitis (NASH) by the end of 2022.