Investors like momentum of lymphoma drug developer

Shares of Citius Pharmaceuticals, a developer of drugs for bloodstream infections, lymphoma, and hemorrhoids, surged over 10% on Wednesday, July 10. This came after the company announced that it had completed trials of one of its drugs and is close to commercially launching another. The company expects “strong momentum” if everything comes together. 

Details

On Wednesday, Citius Pharmaceuticals stock gained 10.3% to $0.75 per share, a one-month high. It is now off 1.5% year-to-date and down nearly 38% over the last 12 months.

The same day, Citius informed investors that it had completed the final phase of clinical trials for its bloodstream infection antibiotic Mino-Lok and, pending regulatory approval, is preparing to start sales of its lymphoma drug LYMPHIR in the near term. This “sets us up for potentially transformative catalysts in the coming months,” CEO Leonard Mazur was quoted as saying in the press release.

What Citius Pharmaceuticals does

Citius develops critical care products. Its Mino-Lok antibiotic for catheter-related bloodstream infections has completed phase III of clinical trials. There are currently no approved or investigational alternatives on the market, said Mazur. The next step is to prepare an approval application for the FDA.

Another Citius drug, LYMPHIR, for the treatment of lymphoma, is already under FDA review. If it is approved, sales are expected to begin as soon as this year. Since it is a new drug, the company would potentially be eligible for 12 years of exclusivity.

These catalysts should allow the company to optimize its current cash runway and future cash needs, Mazur added.

A third drug, intended to alleviate hemorrhoid symptoms, is still in earlier stages of development.

Additionally, Citius  plans to spin off and list its oncology division through a merger with a SPAC, bypassing the IPO process.

Analyst insights

On July 7, TipRanks named Citius Pharmaceuticals as one of two biotech stocks awaiting important FDA decisions. Michael Okunewitch, an analyst at Maxim Group investment bank, said he was “optimistic” regarding the Citius FDA application, writes TipRanks.

According to MarketWatch, two analysts cover the stock. They have a buy recommendation, with a target price of $4 per share, indicating  433% upside.