BridgeBio Pharma smashed Wall Street's expectations in a study of children with dwarfism, leading BBIO stock to break out in massive volume.
The company tested a drug called infigratinib in children with achondroplasia, a genetic condition that slows bone growth. At six months, eight out of 10 children responded to the treatment. The group had an improvement in annualized height velocity — how much they could be expected to grow in a year — of 3.03 centimeters.
Analysts expected a 1.52-centimeter improvement, Mizuho Securities analyst Salim Syed said in a report. In comparison, a rival treatment from BioMarin Pharmaceutical called Voxzogo showed a 2.01-centimeter per year improvement in annualized height velocity in a similar test. Ascendis Pharma is also studying a treatment for achondroplasia.
"Saying that the data (were) a win may be an understatement," he said. "We're now seeing annual height velocity mean change from baseline and in absolute terms in a completely new tier."
On the stock market today, BBIO stock surged 52% and closed at 16.52. Shares broke out of a lengthy consolidation with a buy point at 12.74, according to MarketSmith.com. BioMarin stock fell 6.8% to 94.30. Ascendis shares dipped 0.5% and ended the regular session at 113.56.
BBIO Stock: 99th Percentile Growth
Achondroplasia affects a protein called fibroblast growth factor receptor, or FGFR. In children with this disorder, the protein functions abnormally and slows bone growth. BridgeBio's infigratinib blocks a form of that FGFR protein.
In this study, BridgeBio has tested its treatment in 12 children. Two didn't respond and two haven't yet hit the six-month follow-up mark. At the median, children who received infigratinib had an annualized height velocity of 7.6 centimeters per year. That's beyond the 99th percentile for children with this disorder.
The two patients who hadn't yet reached a six-month follow-up had an annualized height velocity of 8.8 centimeters per year based on three months of data.
Mizuho's Syed estimates BBIO stock could reach a market cap of $3 billion based on just this drug. The company's market cap hit $2.63 billion by midmorning trading, up from $1.65 billion before the market opened. He has a buy rating and 23 price target on BridgeBio shares.
No Safety Issues In Data
Importantly, the drug didn't have any safety issues. None of the patients had high levels of phosphate in their blood — a key safety signal for this treatment. High phosphate can lead to kidney problems.
There was one case of high blood phosphate in an earlier study. But it was a mild case resolved by a dose adjustment.
"This data clearly (position) infigratinib as BridgeBio's second highly de-risked late-stage asset and we expect shares to trade up to the high teens today," SVB Leerink analyst Mani Foroohar said in a report. He has an outperform rating on BBIO stock and raised his price target to 26 from 20.
Mizuho's Syed expects BridgeBio to run a similar clinical study for infigratinib to BioMarin's Voxzogo. In Phase 3 testing, BioMarin enrolled 120 patients.
"Management noted that there are already about 60 participant slots already requested, which reflects a high level of interest that should translate to a high enrollment rate," he said.
The news sent BridgeBio shares to their highest point since December 2021. BBIO stock has a Relative Strength Rating of 93, which puts shares in the top 7% of all stocks when it comes to 12-month performance, according to IBD Digital.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
