Citius Pharmaceuticals stock falls despite approval of its lymphoma drug
Citius Pharmaceuticals announced that the U.S. Food and Drug Administration (FDA) had approved its lymphoma drug LYMPHIR. This marks the first FDA approval for the drug developer. Despite this, quotes on Citius Pharmaceuticals shares plummeted 17% after the opening bell, followed by a slight rebound later. Earlier this week, Citius Pharma announced the spinoff of its oncology subsidiary and its merger with the SPAC TenX Keane Acquisition.
Details
The FDA approved LYMPHIR to treat adults with relapsed or refractory (i.e., treatment-resistant) cutaneous T-cell lymphoma. The regulator recommends using LYMPHIR if the patient has not responded to at least one systemic therapy, according to the press release. This is the first indication for LYMPHIR and the first FDA-approved product for Citius Pharma. Sales are expected to begin within the next five months.
Market reaction
Following the announcement, Citius Pharma stock surged in premarket trading and was up 12% at one point. This was followed by a complete reversal, however. After the opening bell, the stock plunged more than 17% but had managed to whittle that down to a 6.3% loss at the time of this writing. Citius Pharma has risen more than 19% since the beginning of the year and 1.64% over the last 12 months.
According to MarketWatch, three analysts cover the company. They recommend buying the stock, with an average target price of $4.67 per share. Currently, Citius Pharma is trading at $0.84 per share.
Context
Earlier this week, the company announced the spinoff of its oncology subsidiary and its merger with the SPAC TenX Keane Acquisition. The combined entity will be renamed Citius Oncology and continue to trade on the Nasdaq. It will acquire Citius Pharma’s oncology assets, including LYMPHIR. Citius Pharma will hold a stake of about 90% in the new company.
About Citius Pharma
Citius Pharma develops critical care products. In addition to LYMPHIR, its portfolio includes Mino-Lok, an antibiotic to treat catheter-related bloodstream infections, which has completed phase III clinical trials. The company claims that there are currently no approved or investigational alternatives on the market. The next step is to prepare an application for approval by the FDA. Citius Pharma told investors in July that if everything goes as planned, this will transform the company’s assets in the second half of 2024, giving it a strong boost. The company’s third drug, aimed at alleviating hemorrhoid symptoms, is still in the earlier stages of development.
