Pacira Biosciences Inc (NASDAQ: PCRX) is having an overwhelmingly strong start to the trading session this morning. However, if you’re digging for press releases or SEC filings, don’t hold your breath. There’s nothing out there.
Nonetheless, there is a very good reason for the gains. Ultimately, the comapny is seeing gains as the result of a competitor’s failure to appease the FDA. Today, we’ll talk about:
- Why PCRX is making a run for the top;
- what we’re seeing from the stock; and
- what we’ll be watching for ahead.
PCRX Stock Is Climbing On A Competitors Failure
As mentioned above, Pacira BioSciences is having a great day in the market today. However, with no news released, many have been wondering why the stock is climbing. The reason for the movement is simple.
Early this morning, it was announced that the FDA has rejected heron Therapeutics’ NDA. The New Drug Appliction surrounded the candidate known as HTX-011. This is a fixed dose combination of bupivacaine and meloxicam.
If this treatment were to be approved, it would be in direct competition with the PCRX product known as EXPAREL. First approved in 2011, EXPAREL is a very important product for the company.
After all, the product accounted for approximately 99% of the $95.1 million in revenue that PCRX generated in th fourth quarter. If a competing drug were to be approved, it would likely lead to declines in revenues. However, since the FDA has rejected the NDA surrounding HTX-011, the concern surrounding this competition is null for the time being.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to work in the market is that the news leads to moves. When it comes to Pacira Biosciences, the news proved to be overwhelmingly positive.
While the company didn’t issue anything of its own, the fact that a competing drug did not make it past the FDA is great for the company and its investors. After all, it means that the company’s revenue is not at risk of declines due to another brand name competitor hitting the market.
So, it’s not surprising to see that excited investors are pushing the stock up in the market this morning. As is just about always the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (9:36), PCRX is trading at $45.33 per share after a gain of $5.51 per share or 13.86% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on PCRX. In particular, we’re interested in following the company’s continued work to expand sales of EXPAREL, providing meaningful value to investors. Nonetheless, we’ll keep a close eye on the story and bring the news to you as it breaks!
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