XOMA Corporation (NASDAQ:XOMA)
XOMA Corp had an incredibly strong trading session today. If you're looking for fundamental news that was released today, you're not going to find much. The truth is that there really wasn't anything out there today. However, there was a reason for the gains. This trading session's movement was actually a delayed reaction to an announcement that was made yesterday. Today, we'll talk about the announcement, how the market reacted to the news, and what we can expect to see from XOMA moving forward.
The News That Caused XOMA To Climb
Yesterday, XOMA released a very important press release. The company announced that it has initiated an important Phase 2 clinical study. The study surrounds an experimental new drug known as XOMA 213; previously known as LFA102.
XOMA 213 is a monoclonal antibody that is designed to neutralize prolactin induced signaling. This treatment is being designed to treat instances in which benign tumors of the pituitary gland in both men and women. In cases like these, excess secretion can lead to clinically significant abnormal signs and symptoms.
The study is an open-label, mechanism of action, single-dose, multi-center study. Ultimately, the company palns to evaluate two dose levels of XOMA 213. Through the study, the company will evaluate 35 subjects with a goal of confirming the treatment's ability to curtail prolactin signaling. In a statement, Paul Rubin, M.D., SVP of R&D and Chief Medical Officer at XOMA had the following to offer...
“By initiating this mechanism of action study for XOMA 213, we bring a second endocrine-focused asset into mid-stage development... Prolactinomas, which are benign tumors of the pituitary gland, have serious medical consequences, particularly infertility and osteoporosis. Ten to twenty percent of patients do not respont to or are intolerant of current standard of care medications. Based upon the results from this proof-of-concept study, we will be able to determine the value of further developing this antibody for treating patients with symptomatic hyperprolactinemia.”
How The Market Reacted To The News
While the press release was indeed released yesterday, the market seemed to have had a delayed reaction to the news. In fact, today, XOMA did incredibly well throughout the trading session. By the end of the session, the stock climbed to $0.62 per share after a gain of $0.17 per share or 36.50% thus far today.
What We Can Expect To See Moving Forward
Moving forward, I have a relatively mixed opinion of what we can expect to see from XOMA. In the short term, we're likely to see a bit of volatility, as is the case with many experimental stage biotechnology companies. Nonetheless, in the long run, I'm expecting to see incredibly strong gains.
First and foremost, the news about the proof-of-concept study is overwhelmingly positive. If this treatment does prove to be effective, it can also prove to be incredibly profitable in the long run. So, this could send the stock skyrocketing long term. However, XOMA 213 isn't the only reason I have a bullish opinion of the stock.
Another reason that I take such a bullish stance on XOMA is the company's pipeline. At the moment, the company has 5 ongoing treatment candidates. Two of these candidates have now made it to Phase 2, XOMA 213 being one of them. I'm also excited about the results from XOMA 358, which will be coming down the line. The company also has 3 pre-clinical candidates, one of which is headed doward Phase 1. While the company is still very young, it is definitely building a strong pipeline, which I believe will eventually lead to profits. All in all, I'm expecting long run gains.
What Do You Think?
Where do you think XOMA is headed and why?