Some investors are attracted to small biotech stocks because of their potential for explosive returns. It's not uncommon for these stocks to go parabolic after positive news is announced.

That's exactly what happened to Iovance Biotherapeutics (IOVA 0.87%). The stock has skyrocketed more than 100% so far in 2024. But is Iovance Biotherapeutics still a buy after this huge gain?

Behind Iovance's huge gain

As of Feb. 16, 2024, Iovance's share price was up only around 13% year to date. When the market opened on the next business day following the Presidents' Day holiday, the stock took off and hasn't stopped climbing since.

What provided the big catalyst? The U.S. Food and Drug Administration (FDA) announced accelerated approval for Amtagvi (lifileucel) in treating advanced melanoma. This approval marked a milestone for personalized medicine. Amtagvi is the first (and so far only) one-time therapy that uses patient-specific T cells called tumor-infiltrating lymphocyte (TIL) cells to fight cancer.

Technically, though, Iovance's momentum started well before the FDA approval of Amtagvi. The stock began to rise in the fourth quarter of 2023 as investors' anticipation about the prospects for the TIL cell therapy increased.

Iovance announced in mid-September that the FDA had extended its PDUFA date to Feb. 24, 2024 for reviewing the regulatory filing for Amtagvi. However, the agency assured Iovance at the time that there weren't any major issues with the review process.

Iovance's upward trajectory wasn't even stalled when the FDA placed a clinical hold on the company's IOV-LUN-202 trial evaluating LN-145 in treating non-small cell lung cancer. This clinical hold came after a patient participating in the study died.

What's next for Iovance?

The main focus for Iovance now is commercializing Amtagvi, and money shouldn't be an issue. The company took advantage of the recent spike in its share price by issuing roughly 23 million new shares. Iovance expected this offering to raise around $211 million in gross proceeds, part of which will be used to fund the commercial launch of Amtagvi.

There's a lot more involved with this launch than there is for most newly approved drugs. Amtagvi requires a complex manufacturing process.

Patients' T cells are first obtained from a part of their tumors at an authorized treatment center. The T cells are then sent to the Iovance Cell Therapy Center (iCTC) in Philadelphia, Pennsylvania, where they're modified to target the cancer. The T cells are then sent back to the authorized treatment center for administering to the patients.

Iovance is expanding the capacity of iCTC. It's also working closely with more than 30 authorized treatment centers to gear up for treating patients with Amtagvi.

Accelerated approvals from the FDA require confirmatory clinical studies. Iovance is moving forward with a phase 3 study in frontline advanced melanoma in hopes of converting its accelerated approval of Amtagvi to a full approval. The company also plans to file for regulatory approvals of the cell therapy in Europe in the first half of this year.

Is Iovance stock still a buy?

GlobalData projects that Amtagvi could rake in global sales of nearly $900 million by 2029. With Iovance's current market cap of over $4.6 billion, the stock is trading at a price-to-sales ratio of more than 5x, based on estimated revenue that's five years away.

Much of the anticipated growth for Amtagvi is already baked into Iovance's share price. As you might expect, there's considerable uncertainty with sales projections that are years into the future. Because of this, risk-averse investors will be better off looking elsewhere.

However, Iovance's experimental TIL therapies are targeting other types of cancer that impact many more patients than melanoma does. If the company's clinical trials are successful, Iovance could make a lot more money than the projected $900 million for Amtagvi.

The accelerated approval for Amtagvi in melanoma could bode well for Iovance's chances with other indications for the therapy and its other TIL therapies. Aggressive investors who like to make calculated bets should find Iovance an attractive -- albeit risky -- stock to buy.