Any investor that has been in the market long enough has known the joy and agony of being on the right or wrong side of an event. The most common of which are quarterly earnings announcements. Another event that tends to have substantial price consequences is FDA announcements.
Like earnings releases, it's usually known in advance when the FDA is going to thumbs up/down an application for a new drug, product, device… Investors might be wise to keep an eye on the Food & Drug Administration's calendar.
Fortunately, for the purposes of this article, iStock did it for you. We've identified two companies scheduled to hear from the regulatory body by April 1, 2014 – no fooling.
On March 31, 2014, the FDA will discuss NDA 021-883, dalbavancin hydrochloride for intravenous injection, submitted by Durata Therapeutics Inc (NASDAQ:DRTX), for the proposed indication of treatment of acute bacterial skin and skin structure infections.
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Dalbavancin is a second generation, semi-synthetic lipoglycopeptide, which consists of lipophilic side-chains attached to glycopeptides. The microbiologic profile of dalbavancin demonstrates bactericidal activity in vitro against a broad range of bacteria, such as Staphylococcus aureus (including methicillin-resistant strains) and Streptococcus pyogenes, as well as certain other streptococcal species.
Experts estimate that nearly 1.7 million hospital patients a year (and growing) were treated for skin and skin structure infections (SSSIs). DRTX says, "The majority of skin and soft tissue infections in hospitalized patients are caused by Staphylococcus aureus and approximately 59 percent of these infections are estimated to be caused by MRSA in the U.S."
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It sure looks as if expectations are running high based on Durata Therapeutics chart. The stock is a few days removed from a spike to its 52-week high of $16.99. We wouldn't be too surprised to see DRTX trade there again on good news from the FDA, but bad news could bring the stock close to $10 in our technical analysis opinion.
On April Fools' Day, the Endocrinologic and Metabolic Drugs Advisory Committee of the U.S. Food and Drug Administration (FDA) is tentatively scheduled to review MannKind Corporation's (NASDAQ:MNKD) New Drug Application (NDA) for AFREZZA (insulin human [rDNA origin]) Inhalation Powder.
AFREZZA (pronounced uh-FREZZ-uh) is a first-in-class, ultra rapid-acting mealtime insulin therapy being developed to improve glycemic control in adults with Type 1 and Type 2 diabetes mellitus.
According to MannKind, "Administered at the start of a meal, AFREZZA dissolves immediately upon inhalation and delivers insulin quickly to the blood stream. Peak insulin levels are achieved within 12 to 15 minutes of administration, mimicking the release of mealtime insulin observed in healthy individuals."
The American Diabetes Association says:
26 Million Children and Adults in the US have diabetes 79 million have prediabetes 1.9 million people a year a diagnosed with diabetes As many as 1 in 3 Americans will have diabetes by 2050 if trends hold The economic cost of diagnosed diabetes in the U.S. is $245 billion per year
Needless to say, a positive response from the FDA on MNKD's AFREZZA could be a significant price driver for shareholder.
Unlike Durata, pre-FDA price action on MannKind shows investors are less hopeful for as the stock price is trending lower pre-meeting. Based on our view of the chart, MKND shares could swing to resistance at $7.75 or to support $4.50 depending on the FDA's word.
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