What happened
Shares of Clovis Oncology (CLVS +0.00%) headed for the moon on Tuesday after the company reported positive interim phase 1/2 clinical trial results for one of its therapies on June 14, with its shares up by more than 65% as of 11 a.m. ET today before pulling back slightly.
Of the nine patients dosed with the company's FAP-2286 radiotherapy drug for solid tumors, one exhibited a partial response to treatment, and there weren't any instances of people withdrawing from the study or cutting back dosing due to side effects.
OTC: CLVS
Key Data Points
So what
Clovis currently has one product approved, a pill called Rubraca that's an adjunct and maintenance therapy for certain types of ovarian and prostate cancer, but it isn't profitable.
As with all small-cap biotechs, good results from early-stage pipeline projects like FAP-2286 mean that the company has a higher chance of commercializing it in the future, though the risk of failure still remains high. And the gains to its stock price will help the biotech if it plans to issue new shares to raise cash.
Now what
With the phase 1 trial looking favorable so far, it will continue to recruit new patients on a rolling basis. And assuming that side effects continue to be limited and tolerable, the next step will be the phase 2 portion of the study, which will determine the appropriate dosing ranges for FAP-2286. Investors should be on the lookout for any further hints about the medicine's efficacy, as well as whether Clovis intends to narrow its target indication to a specific cancer. Both could cause another massive price movement.
At the same time, after such a sharp run-up in its share price, any news of a setback in the FAP-2286 trial could leave new shareholders with some gnarly losses.
