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Here's Why Arena Pharmaceuticals (ARNA) Stock is Skyrocketing Today

Madeleine Johnson

On Tuesday, shares of biopharmaceutical company Arena Pharmaceuticals ARNA are skyrocketing, up about 41% to $26.10 per share in afternoon trading after it reported positive mid-stage trial results for one of its drugs. The stock was up 45% in pre-market trading.

Arena said that within its 61-patient trial its experimental pulmonary arterial hypertension (PAH) drug, ralinepag, significantly improved pulmonary vascular resistance compared to patients receiving a placebo. The drug also showed numerical improvement in six-minute walk distance.

"The positive outcome of this Phase 2 trial in a contemporary PAH patient population is an important milestone in the development of ralinepag for the treatment of patients suffering from this grievous illness," stated Preston Klassen, M.D., MHS, Executive Vice President, Research and Development and Chief Medical Officer of Arena.

PAH is a chronic—and currently incurable disease—that causes the walls of the arteries of the lungs to tighten and stiffen. In someone who suffers from PAH, the right side of the heart has to work harder to push blood through the narrowed arteries in the lungs.

Johnson & Johnson JNJ and United Therapeutics UTHR dominate the PAH market at the moment, but Arena hopes ralinepag will be designated as “best-in-class,” which would help the company compete against its rivals. These results from the mid-stage trial is definitely a step in the right direction.

Looking ahead, Arena is planning on advancing ralinepag into a pivotal-stage trial soon. "It is exciting to see the positive nonclinical pharmacological profile translating into potentially the first oral prostacyclin therapy that may approach consistent therapeutic levels without the complexity of parenteral (IV) therapy. These data give us confidence to move expeditiously toward a Phase 3 clinical program,” Dr. Klassen continued.

Right now, ARNA is a #2 (Buy) on the Zacks Rank.

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