NEW YORK (AP) — Shares of Vanda Pharmaceuticals Inc. climbed Tuesday after the company said the Food and Drug Administration is planning a faster review of its sleep disorder drug tasimelteon. That could bring the drug to market more quickly.
THE SPARK: Vanda said the FDA plans to complete its review by Jan. 31, taking less than the usual 10 months. It said a panel of FDA advisors will discuss the drug at a meeting on Nov. 14. A positive recommendation would improve the chances the drug will be approved.
Tasimelteon is intended to treat non-24-hour disorder, a rare disorder that affects blind people. Patients have difficulty lining up their sleep patterns with the 24 hours in a day because they can't detect light. Vanda said there are no approved treatments for the condition. The drug met its goals in one late-stage trial in December and in a second study in January.
THE BIG PICTURE: Vanda's only approved drug is the schizophrenia treatment Fanapt.
The company is scheduled to report its second-quarter results before the market opens on Wednesday.
THE ANALYSIS: Jefferies & Co. analyst Oren Livnat said the FDA's decision suggests that is sees non-24-hour disorder as an important unmet medical need and doesn't consider tasimelteon a typical insomnia drug. He maintained a "Buy" rating on Vanda shares and raised his price target to $13 from $11.
SHARE ACTION: The company's shares jumped 40 percent to $11.27 in morning trading. The stock has traded between $2.92 and $13.30 in the last 12 months.