What's Behind This Biotech's 40% Pop?

What's Behind This Biotech's 40% Pop?

The Motley Fool's Market Checkup drills down on the hottest headlines and biggest market movers in the health-care sector. This episode -- featuring a special guest appearance by Dan Caplinger, The Motley Fool's director of investment planning -- highlights a biotech stock that popped 40%, gives a full examination of the Affordable Care Act's debut week, and finishes off with two stocks poised to profit from Obamacare.

In this video, health-care analyst David Williamson and bureau chief Max Macaluso discuss the big jump Friday in shares of biotech Discovery Labs . Discovery's key drug Surfaxin, which treats a potentially fatal breathing condition in infants, had a long history of FDA rejections before finally getting approved on its fifth attempt. However, at the time it approved the drug, the FDA didn't allow Discovery to sell it before getting FDA agreement on updated product specifications. Friday's pop came after the FDA finally gave its agreement to those specifications, clearing the way for Surfaxin to hit the market during the fourth quarter of this year. David notes, however, that Surfaxin will face tough competition from AbbVie's Survanta and Cornerstone Therapeutics Curosurf. David discusses Discovery's expectations about the impact of the news on its business and whether the stock is a buy after the big pop.

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The article What's Behind This Biotech's 40% Pop? originally appeared on Fool.com.

David Williamson, Max Macaluso, Ph.D., and Fool contributor Dan Caplinger have no position in any stocks mentioned, and neither does The Motley Fool. 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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Originally published