What happened
Shares of Insmed(NASDAQ: INSM) were up more than 17% for the week as of 10:30 a.m. ET on Friday, according to data provided by S&P Global Market Intelligence. The healthcare company closed last week at $22.64, then rose to a 52-week high of $27.15 on Tuesday and Thursday. The company announced positive trial data earlier in the week, and analysts upgraded their positions on the stock.
So what
On Tuesday, Insmed reported positive top-line results from its Phase 3 study of Arikayce to treat patients (who had not started antibiotics) with newly diagnosed or recurrent nontuberculous mycobacterial (NTM) lung infection caused by Mycobacterium avium complex (MAC). There are no established endpoints to evaluate MAC treatments, and Insmed said it is hoping the Food and Drug Administration (FDA) will adopt its Quality of Life-Bronchiectasis measurement.
The biotech company is looking to extend Arikayce's currently allowed approval from the FDA strictly as a combination therapy, with other antibiotics, to treat MAC lung disease patients with limited or no other options.
The strong trial results led Guggenheim on Monday to upgrade its price targe for Insmed from $50 a share to $52 a share. On Tuesday, Bank of America boosted its price target for the stock from $35 to $37, and on Thursday, Evercore ISI raised its Insmed target price from $32 to $42.
Now what
The company has been able to grow revenue but is still a long way from being profitable. In the second quarter, the company had a record $77.2 million in revenue, up 18% year over year, but lost $1.78 in earnings per share (EPS) compared to a loss of $0.80 of EPS in the same period last year. It also raised its full-year revenue guidance for Arikayce from a previous range of $285 million to $300 million to a new range of $295 million to $305 million.
Arikayce is the company's only approved drug, but it also has brensocatib in late-stage trials to treat various inflammatory conditions.
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Jim Halley has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
