Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Neurocrine Biosciences (NASDAQ:NBIX), a biopharmaceutical company focused on treatments for neurological and endocrine-related diseases and disorders, scorched higher by as much as 88% after announcing positive results for its VMAT2 inhibitor NBI-98854 as a treatment for tardive dyskinesia, a disease that produces abnormal and involuntary muscle movements.

So what: According to Neurocrine's press release, NBI-98854 demonstrated "a statistically significant and clinically meaningful reduction in tardive dyskinesia symptoms." Utilizing the Abnormal Involuntary Movement Scale (AIMS) as the baseline measurement, at week six AIMS scores were reduced by 2.6 points in the NBI-98854 arm while there was a reduction of just 0.2 points in the placebo arm. In addition, the responder rate in the intent-to-treat NBI-98854 cohort was 49% compared to just 18% from the placebo. Finally, if that wasn't impressive enough, 67% of those taking NBI-98854 were deemed "much improved" or "very much improved" compared to just 16% of placebo subjects at week six.

Now what: And this is why shareholders shouldn't overreact so much when dose escalation studies are still ongoing! In September, Neurocrine Biosciences was creamed after announcing that its 50 mg study didn't meet statistical significance, but that its 100 mg cohort did after two weeks. All investors had to do was bide their time a bit while Neurocrine ran additional studies on its tardive dyskinesia experimental drug to find the proper dosing and that would have been that. Instead, Neurocrine was clobbered -- but it has gained all of that back, and some, after today's press release. This is definitely a drug worth watching moving forward as tardive dyskinesia has few available treatment options, leaving the door wide open for Neurocrine to have an instant blockbuster.

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