The stock market got off to a solid start on Monday, although there was a considerable disparity among different kinds of stocks. Small-cap indexes were down sharply, but the Dow Jones Industrial Average (^DJI -1.01%) was higher by about a quarter-percent in early-afternoon trading. Investors continued to wrestle with macroeconomic cross-currents that left many wondering what the future would bring.
In the biotechnology industry, all it takes is one piece of news to make stocks see big moves. That was the case for two different biotech stocks on Monday. On the upside, BridgeBio Pharma (BBIO -2.52%) soared after releasing promising data on one of its treatments, while Aclaris Therapeutics (ACRS 1.28%) went the other direction on less-encouraging trial results.
Here's more about what put these two biotechs into the spotlight to start the week.
BridgeBio sees breakout data
Shares of BridgeBio Pharma jumped almost 60% in midafternoon trading on Monday. The Palo Alto, California-based biopharmaceutical company announced positive results in a phase 2 clinical trial of its candidate therapy infigratinib.
The Propel2 trial looked at infigratinib in children suffering from achondroplasia, which typically leads to patients failing to reach full height. In the study, the first 10 participants among those patients receiving the highest dosage of the treatment saw an average improvement six months in of more than 3 centimeters per year in growth rates compared to the baseline. Fully 80% of the children saw an increase of at least 25% from the baseline in the annualized speed at which height increased. The once-daily oral therapy showed no adverse events, suggesting a favorable safety profile.
Based on the trial results, BridgeBio has started to enroll new patients for a phase 3 trial. In addition, the company will look at expanding the use of infigratinib for the new indication of hypochondroplasia, which is closely related to achondroplasia.
About 55,000 people in the U.S. and the European Union suffer from achondroplasia, which is the most common cause of disproportionately short stature. With up to 10,000 children and adolescents still with the potential to grow, BridgeBio is optimistic that it can help improve quality of life for a large population over time.
Aclaris misses the mark
Meanwhile, shares of Aclaris Therapeutics dropped by nearly half on Monday. The biopharmaceutical company's phase 2a clinical study to investigate its zunsemetinib investigational treatment for moderate to severe hidradenitis suppurativa, a painful long-term skin condition, didn't provide the results investors had wanted to see.
The main reason why Aclaris shares fell so sharply is that the company said that the study failed to meet its primary endpoint of demonstrating a statistically significant change from baseline in the count of inflammatory nodules and abscesses after 12 weeks compared to a placebo. In addition, though, Aclaris noted that the study also failed to meet various secondary endpoints related to zunsemetinib's efficacy, including the percentage of patients who saw a more than 50% reduction in abscesses and inflammatory nodules.
Despite the loss of investor confidence, Aclaris expects to continue its phase 2b study of zunsemetinib for the treatment of rheumatoid arthritis. CEO Doug Manion noted that there were some promising aspects of how the zunsemetinib worked in the trial that could have positive implications going forward as Aclaris continues its clinical research.
Investors were nevertheless discouraged to see Aclaris' lead candidate encounter a setback. The stock's move took it back to levels last seen more than two years ago, and the company will have to find some success in order to claw back its losses.