Shares of Fennec Pharmaceuticals Inc. rose more than 10% in Wednesday morning trading, adding to Tuesday's rally, after the specialty pharmaceutical company received a long-awaited green light from the U.S. Food and Drug Administration for its Pedmark.
Fennec shares jumped sharply late in Tuesday's session after the FDA announced the approval of Pedmark to reduce the risk of hearing loss associated with cisplatin chemotherapy in children, ending the day with a gain of nearly 16%.
The FDA twice last year rejected the company's application for Pedmark because of issues at the plant where the drug is made.
In a research report, Wedbush analysts David Nierengarten and Dennis Pak said that Pedmark received a broad label that isn't limited to tumors treated with cisplatin in clinical studies, which could make Fennec a good portfolio fit and an attractive buyout target for a mid-size pharmaceutical company.
The analysts, who have an outperform recommendation and $11 a share price target on Fennec shares, said the company has considerable financial flexibility to support initial commercial launch activities, but they are waiting for details on the company's commercial strategy and pricing before they make any adjustments to their model.