High-ranking biotech stock Amphastar Pharmaceuticals hit a record high Friday after U.S. officials approved its generic version of an Organon infertility drug.
The Food and Drug Administration approved Amphastar's shot called Ganirelix Acetate Injection. The drug is a cheaper knockoff of Organon's treatment, which helps control the timing of ovulation in women undergoing infertility treatment.
Last year, branded and generic versions of the infertility drug generated a collective $89 million in sales, Amphastar said in a news release, citing Iqvia research.
On today's stock market, Amphastar shares jumped 2.5% to 41.16. The move continued a strong run for the biotech stock. As of Friday's close, shares have surged nearly 78% this year. Amphastar stock broke out of a cup-with-handle base and twice tested its 10-week average. The stock is now well extended from its buy point at 21.80.
Biotech Stock: Launch Expected Soon
Ganirelix works by blocking premature increases in luteinizing hormone, a chemical that triggers ovulation. This helps control the timing of ovulation stimulation in fertility treatment.
Amphastar focuses on generic products. The FDA is currently reviewing four of its applications for generic drugs. These four drugs have a market size of roughly $3.9 billion, the company says. It also has eight generics in development, targeting an additional $12 billion in market size. Among its efforts, Amphastar is working on biosimilar insulin for diabetes treatment.
Amphastar plans to launch its generic Ganirelix this quarter. Strong sales could boost the biotech stock even further.
"Ganirelix is the company's fourth injectable peptide product approval," Chief Executive Jack Zhang said in a written statement. "It represents our capabilities in executing our pipeline while furthering the development of our diabetes product portfolio."
Highly Rated Stock
Amphastar is a highly rated biotech. It has a best-possible Relative Strength Rating of 99. This puts shares in the top 1% of all stocks in terms of 12-month performance, according to IBD Digital.
Shares also have strong IBD Composite and EPS Ratings of 96 and 97, respectively. The Composite Rating is a 1-99 measure of a stock's fundamental and technical measures, while the EPS Rating examines a stock's profitability. In 2021, Amphastar earned $1.37 per share, minus some items. Adjusted earnings per share more than doubled.
This year, biotech stock analysts call for Amphastar to earn $1.62 a share on $496.8 million in sales. Earnings would pop 18% and sales would rise more than 13%.
Amphastar is an IBD Tech Leader and ranks third on the IBD 50 list of elite stocks.
The biotech stock is well above its 50-day and 200-day moving averages, MarketSmith.com shows.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
