[ad_1]
Biotechnology actions Therapeutic protagonist (PTGX) crashed Friday after the Food and Drug Administration put its key drug on hold due to safety concerns.
X
The protagonist studies the drug, rusfertide, in patients with diseases of the blood. But the mice that received the drug developed tumors under their skin. Now the FDA says the protagonist must stop all human studies on rusfertide.
In today’s stock market, the biotech stock fell 62% to 17.53.
SVB Leerink analyst Joseph Schwartz expected the biotech stock to plunge.
“Considering that rusfertide makes up the majority of Protagonist’s share price by our estimate, we would expect the shares to trade significantly on today’s news,” he said in a note to clients. “However, in our opinion, not all of that value should come out of stock, as these bottlenecks are usually resolved.”
Biotech stock market crashes are suspended
But Protagonist might struggle to meet his schedule, Schwartz said. The company submits safety reports to the FDA, updates investigator and patient documents, and changes study protocols.
Investors in the biotech stock expected Protagonist to have proof of concept data for rusfertide in hereditary hemochromatosis in the second half of 2021, Schwartz said. Additionally, investors were hoping for Phase 2 results in polycythemia vera in the fourth quarter.
Nevertheless, it retained its outperformance rating on biotechnology shares.
Biotech stock fell to its lowest level since January. The stocks fell well below their 200-day moving average, according to MarketSmith.com.
Bullishly, the biotech stocks protagonist also has a strong relative strength rating of 95, according to IBD Digital. This places stocks in the top 5% of all stocks in terms of 12 month performance.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
YOU MAY ALSO LIKE:
FDA likely to approve Covid boosters – with some caveats for Pfizer, Moderna
Why the future looks cloudy for Aerie Pharmaceuticals drug as stocks tumble
Looking for the next apple or Amazon? Start With These S&P 500 Win Lists
IBD Stock of the Day: Find out how to find, track and buy the best stocks
Take advantage of short-term trends with SwingTrader
[ad_2]
Source link