Shares in Arcutis Biotherapeutics (ARQT +4.68%) soared by almost 30% in trading to 10:30 a.m. ET today. The move comes after an excellent set of third-quarter earnings and an investor day presentation replete with positive near- and medium-term guidance that exceeded analyst expectations.
Arcutis Biotherapeutics' growth plans
Management aims to turn Arcutis into a leading player in medical dermatology through its Zoryve (roflimilast) portfolio of topical treatments. Zoryve is a selective phosphodiesterase-4 (PDE4) inhibitor (a drug that inhibits the PDE4 enzyme, resulting in anti-inflammatory effects) that the Food and Drug Administration (FDA) has already approved in plaque psoriasis and atopic dermatitis, in cream form, and seborrheic dermatitis, in foam form.
NASDAQ: ARQT
Key Data Points
It has also been submitted to the FDA for approval for plaque psoriasis in 2- to 5-year-olds and for phase 2 (foam) trials in vitiligo and hidradenitis suppurativa.
As ever with any pharmaceutical company in clinical trials, there's an element of risk involved, but the statistical evidence suggests pre-approved drugs have a much higher chance of success in new indications than novel compounds.
Partly based on this confidence, management sees a bright future for the company with Zoryve sales potentially reaching $2.6 billion to $3.5 billion over time. The near-term outlook is positive, too, with management forecasting sales of $455 million to $470 million in 2026. That figure excited the market today, because it's significantly higher than the $438 million Wall Street analysts had penciled in.
Image source: Getty Images.
What's next for Arcutis?
Noting that the high point of management's target for peak Zoryve sales is higher than the market cap of less than $3 billion at the time of writing, plus the impressive 30%-plus sales growth projection over the next couple of years, and the relatively less risky clinical trials in progress, Arcutis appears to have a bright future ahead of it.
