|Why Radius Health Stock surged|
|By Marilyn Mullen|
|Thursday, 18 June 2015 15:02|
Shares of pharmaceutical firm Radius Health, which specialises in making products for treating osteoporosis, surged by over 17% today due to heavy trading after the firm came out with positive clinical data pertaining to investigational drug abaloparatide.
The firm stated that patients who earlier completed 18 month long phase 3 ACTIVE clinical trial were participating in follow on ACTIVExtend trial showed no new vertebral fractures through first 6 month of follow on trial.
All in all, the 25 month long study of abaloparatide-SC, demonstrated positive clinical outcomes that included big reductions in vertebral, clinical, non-vertebral and major osteoporotic fractures.\
The firm opines that the trials demonstrate that drug has achieved primary as well as secondary endpoints that are important for helping the firm make the drug for regulatory submission.
Investors were right in cheering the news that may aid the firm go a step closer in bringing the first drug to market. Osteoporosis is big problem as the International Osteoporosis Foundation has given an estimated that over 200 million people all over the world suffer from the disease leading to over 8.9 million fractures annually.
To do the treatment is big deal as in the previous year, global sales of osteoporosis therapies were to the tune of $6.4 billion with $2.3 billion coming from injectable drugs.
Radius is planning to make a foray into the big market. However, investors should know that Radius is a high risk company which is presently burning over $60 million in operating cash per year as it aims to make abaloparatide.
But, with over $230 million in cash on balance sheet, the firm has a lot of reserves for next few years as they work for bringing their first drug to market.