Shares of MoonLake Immunotherapeutics rocketed Tuesday after rival Acelyrin unexpectedly reported a failure for its skin disease treatment. MLTX stock neared a record high after retaking its 50-day line.
The companies are both working on treatments for hidradenitis suppurativa, a chronic inflammatory skin condition that causes deep nodules and abscesses. But patients who received Acelyrin's drug, izokibep, didn't show statistically significant improvements in symptoms after 16 weeks.
Acelyrin said patients who responded to izokibep treatment early dropped out of the study. Further, there was a higher-than-expected response rate from placebo recipients. Both skewed the numbers. Needham analyst Serge Belanger says he didn't expect izokibep to beat out MoonLake's sonelokimab.
"But a failure is a surprise that removes an overhang on MoonLake and further cements sonelokimab's best-in-class position in hidradenitis suppurativa," he said in a report.
On today's stock market, MLTX stock soared 9.9%, closing at 57.82. Shares neared the stock's previous all-time high at 63.40 after retaking their 50-day moving average, MarketSmith.com shows. MoonLake stock has a best-possible IBD Digital Relative Strength Rating of 99, putting its 12-month performance in the leading 1% of all stocks.
Acelyrin shares, on the other hand, collapsed 54.1% to 12.80.
MLTX Stock: Upcoming Data Readouts
MoonLake is developing sonelokimab as a treatment for patients with hidradenitis suppurativa and moderate-to severe-psoriatic arthritis.
In late October, the company expects to unveil the results of a 24-week test in patients with the former condition. MoonLake will follow that up in early November, when it expects to have the results of a 12-week study in psoriatic arthritis.
"The company's expectations for these upcoming results are more or less the same as the Street's in hidradenitis suppurativa," Needham's Belanger said. "In hidradenitis suppurativa, sonelokimab is expected to improve upon best-in-class results achieved at 12 weeks."
In psoriatic arthritis, the company expects to meet or beat the best-in-class results achieved by UBS' bimekizumab. UBS sells that drug in Europe under the brand name Bimzelx.
Belanger kept his buy rating on MLTX stock.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
