Puma Biotechnology Inc PBYI 0.37% traders are eagerly-anticipating the end of the trading halt for Puma on Wednesday after the company received a positive recommendation for approval of neratinib from the FDA’s Oncologic Drugs Advisory Committee.
The advisory committee voted 12-4 to recommend approval of neratinib for treatment of patients with early-stage HER2-positive breast cancer. The stock is scheduled to resume trading at 1:50 p.m. ET.
When the stock resumes trading, it could make a huge jump. Shares spiked 39.1 percent on Monday after the FDA’s initial review of neratinib was let critical than investors had anticipated. JPMorgan said this week that the options market was pricing in a 60 percent implied volatility in Puma stock this week, suggesting the stock could be in for a big move one trading resumes.
Update: The stock opened 23 percent higher and traded recently at $69.80, up 20 percent as of 3:30 p.m. ET.
Short sellers were hoping that concerns over neratinib’s diarrhea risk and changes made to the pivotal clinical trial would discourage the panel from recommending approval.
“The tolerability of neratinib in this patient population is a concern given the frequent dose interruptions, reductions and discontinuations observed, mostly due to diarrhea,” the FDA wrote on Monday. Nearly 40 percent of the patients treated with neratinib reportedly experienced at least grade-3 diarrhea.
In March 2016, the FDA recommended Puma delay its approval application for neratinib due to design changes made to the neratinib study, but the company went ahead with the application anyway.
The committee vote was a major binary trading event for the market. A vote to reject the application would have sent…
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