Small cap Cerus spikes on back-to-back Intercept approvals by FDA

The Intercept Blood System for plasma--Courtesy of Cerus

Small cap Cerus ($CERS) has gained some serious ground on Wall Street after the FDA approved its Intercept Blood System for platelets just a few days after the agency approved a similar system for plasma use. Investors are betting that with the risk of Ebola in the forefront of public consciousness that processors of blood products will use any technology they can to improve the safety of their supply. These approvals mark the first time the FDA has approved a system to inactivate pathogens in platelets or plasma.

Since before the plasma approval earlier this week, Cerus is now up almost by 50% to a market capitalization of about $525 million. Now, to retain and capitalize upon investor favor, the company is going to make good on sales of the two systems, which are different but use the same illumination device and active compound of amotosalen as well as similar production steps.

The company is targeting the roughly 60 blood center customers that are led by four major groups including the American Red Cross and HemeXcel, Cerus President and CEO William Greenman said on a conference call about the plasma approval earlier this week. On a Dec. 19 call about the platelet approval, he also specified some hospitals as another potential buyer for the systems, particularly the platelet one.

Cerus CEO William Greenman

"There are a number of hospitals, self-collectors like the pediatric hospitals or stem cell transplant sort of hematology-oncology focused, hospitals that are self-collectors of platelets," Greenman said on the latest call. "They do that because they enjoy potentially lower cost by self-collecting. But probably moreover, just like the ability of control and availability of platelets for their patients. And some of those customers would be more specifically interested in Intercept platelets."

The company will provide 2015 guidance on its fourth quarter earning call in late February.

The platelet system is approved for approved for ex vivo preparation of pathogen-reduced apheresis platelet components in order to reduce the risk of transfusion-transmitted infection, including sepsis, and to potentially reduce the risk of transfusion-associated graft versus host disease.

Bacterial contamination of platelets is the second most common cause of transfusion-related deaths in the U.S., the company said. Platelets often are administered to patients with a low platelet count or non-functioning platelets due to cancer, chemotherapy or surgical procedures.

"The Intercept Blood System for platelets represents an important advancement in improving platelet safety, both in reducing the risk of contamination with bacteria and other pathogens and in lowering the risk of transfusion-associated graft-versus-host disease," Dr. Karen Midthun, director of the FDA's Center for Biologics Evaluation and Research, said in a statement.

- here is the release

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