Anika pops after the FDA finally approves its arthritis jab

Anika Therapeutics CEO Charles Sherwood

After two stinging rejections sent it back to the lab, Anika Therapeutics ($ANIK) has secured the FDA's blessing for an osteoarthritis pain injection, propelling the biotech's shares up more than 40%.

The drug, Monovisc, is a single-shot formulation of bacteria-derived hyaluronic acid designed to ease knee pain in OA sufferers getting little benefit from analgesics like acetaminophen. The FDA had twice spurned the injection, first in 2010 and then again by denying an appeal in 2012, Reuters notes. But Anika retooled its application in the ensuing year and submitted once more in 2013, this time convincing regulators to back its product.

The approval sent Anika's shares soaring close to $50 in premarket trading on Wednesday, reflecting investor confidence that the company can make some noise in a market still littered with multi-injection treatments, including its own Orthovisc. And much of the excitement is tied to Anika's stateside partner: Under an agreement signed in 2011, Johnson & Johnson's ($JNJ) huge Synthes orthopedics business will distribute Monovisc, and the biotech is due a $5 million milestone upon the first sale with more payments lined up.

"The U.S. market for viscosupplementation therapy is experiencing double-digit growth annually," Anika CEO Charles Sherwood said in a statement, adding that J&J plans to launch the drug at March's annual meeting of the American Academy of Orthopedic Surgeons.

Monovisc is already approved in Canada and parts of Europe, and, as a single-shot affair, it competes with offerings from Sanofi's ($SNY) Genzyme and Zimmer ($ZMH), according to Reuters. In 2010 and 2011, Genzyme filed lawsuits against the other two, claiming their injections violated patents tied to its Synvisc-One treatment, but nothing has come of either action since.

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