Shares of the US biotechnology company Reata Pharmaceuticals Inc. surged 175% on Wednesday to hit a one-year high in early trading. The surge in Reata shares was prompted after the US Food and Drug Administration (FDA) approved Reata’s rare disease drug Skyclarys.
The Reata stock on Wednesday was among the top gainers across the US stock exchanges.
On Tuesday, Reata shares ended 1% higher at $31.17. The US drug regulator gave its approval on Tuesday to Reata Pharmaceuticals Inc’s drug for the treatment of Friedreich’s ataxia, a rare genetic disorder that causes progressive damage to the nervous system.
The biotech firm has set the price of the drug at a wholesale acquisition cost of $370,000 annually. Reata’s Skyclarys is the first drug therapy to get US FDA approval for the treatment of Friedreich’s ataxia.
Reata estimates show that there are 5,000 patients of disorder Friedreich’s ataxia in the United States. Friedreich’s ataxia is a rare neuromuscular disorder that causes weakness in muscles and loss of coordination. Patients with this disorder experience progressive difficulty in walking.
Reata Pharmaceuticals’ case for FDA approval was based on additional data and a mid-stage study. The firm said its study showed that patients who took the drug experienced an improvement in neurological functions such as speaking, swallowing, and standing, compared with a placebo.