Kythera Biopharmaceuticals picked up an early FDA approval for its fat-melting injected treatment, a drug now cleared to erase double chins.
FDA reviewers took no issue with Kythera Biopharmaceuticals' drug to reduce chin fat, signing off on its efficacy ahead of a crucial panel meeting.
Shares of the Calabasas, CA-based biotech outfit shot up more than 25% to $42 midmorning on Tuesday after its Monday release on the results. The promise of ATX-101 could make Kythera a buyout target, an analyst from Cowen & Co. noted, and recommended buying the company's shares.
Bayer Healthcare touted upbeat data from a pair of late-stage studies of an investigational drug targeting chin fat, setting the stage for the giant to step into growing aesthetic treatment market. And the results provide a victory from Kythera, which licensed the injected drug to Bayer for markets outside the U.S. and Canada.
After taking a beating in previous years, biotech has been hot sector on Wall Street this year. The Nasdaq Biotech Index has shot up 30% this year compared with 15% growth in the broader market. And the fact that this year's total number of biotech IPOs already matches that of 2011 indicates that there could be a growing appetite for these types of investments. But there's no indication that we're on the verge of, or will ever, return to the go-go years of the 1990s when biotechs more easily went public at lofty values. Here's the full report >>
In a rare day for biotech IPOs, Kythera Biopharmaceuticals and Intercept Pharmaceuticals hit the public markets Thursday with prices at the high end of anticipated ranges and big jumps in value. It's up for debate what the huge day for the two biotech IPOs means for other drug developers angling to go public, and in some ways Kythera and Intercept appear to be unique cases in the biopharma industry.
The biotech's lead therapy, now in late-stage development, is aimed at eliminating chin fat. That may not be a big unmet medical need in the pharma world, but investors saw a big upside on demand if the drug can win approval.
Kythera Biopharmaceuticals has stuck an expected price range of $14 to $16 per share on stock in the biotech group's proposed initial public offering, seeking to raise funds to advance an injected drug for elective treatments to wipe out chin fat.
The IPO's success will hinge on the company's ability to generate some investor excitement over ATX-101, a late-stage fat-busting therapy intended to cure people of the double chin.
As it settles its differences with the FDA and embarks on finding new ownership, Cetero Research is being pursued by a California biotech that wants almost $250,000 from the troubled CRO, alleging a breach of contract.