Why Omeros Corporation Shares Jumped
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 Omeros , a clinical-stage biopharmaceutical company focused on therapies to treat coagulopathies, inflammation, and central nervous system disorders, jumped as much as 15% after receiving the fast-track designation from the Food and Drug Administration for experimental Huntington's disease drug, OMS824.
So what: According to Omeros' press release, OMS824, a drug that selectively inhibits PDE10, an enzyme that's expressed in areas of the brain that are believed to be linked to a number of cognitive-affecting conditions, has tested positively in terms of safety and tolerability in phase 1 studies. The company plans to begin enrollment in a phase 2 study to evaluate OMS824 in Huntington's disease patients within the next few weeks. The fast track designation will allow Omeros more opportunities to work hand in hand with the FDA in OMS824's development and could involve a priority review if it meets its endpoints in studies.
Now what: Not to rain on Omeros' parade, because this is clearly good news today, but shareholders should consider that we're talking about an experimental compound that's only really been assessed for pharmacokinetic safety and tolerability thus far. In other words, it looks as if shareholders are starting to count their chickens before they're hatched. Likewise, cognitive disorders of the brain have proven extremely difficult to treat, with a number of key late-stage study failures in recent years. My thoughts are positive for OMS824, but realistically, it's far too early to be as excited as shareholders appear today over this early-stage drug.
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The article Why Omeros Corporation Shares Jumped originally appeared on Fool.com.Sean Williams has no position in any stocks mentioned . You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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