Protagonist Therapeutics shares nearly doubled on Monday: explore why

Shares of Protagonist Therapeutics Inc (NASDAQ: PTGX) nearly doubled on Monday as the U.S. FDA said it could resume the clinical trials for Rusfertide - an investigational, injectable hepcidin mimetic.

The U.S. FDA had paused the clinical studies last month

The drug regulator had paused the clinical studies last month after the use of the blood cancer treatment in the mice model was suspected of having caused subcutaneous skin tumours.

Upon evaluating the “requested information”, however, the Food and Drug Administration on Monday allowed Protagonist Therapeutics to resume its clinical trials for Rusfertide. In the press release, CEO Dinesh Patel said:

The stock is still down 30% from September high

According to SVB Leerink’s Joseph Schwartz, the announcement is a “very welcomed surprise” as the U.S. FDA announced the clinical hold only last month, and the timeline for when it will be lifted was unclear.

The welcome was evident in the price action this morning that pushed the market cap of the U.S. biotech firm up, to $1.68 billion. The stock, however, is still down about 30% from its year-to-date high on September 1^st.