United Therapeutics Shares Gain on FDA Hypertension Approval

Dec 23, 2013 4:04 pm ET

(Updates with closing share price in second paragraph.)

Dec. 23 (Bloomberg) -- United Therapeutics Corp. gained the most in six years, after winning U.S. marketing approval for the oral version of its treatment for high blood pressure in the arteries that supply the lungs.

The drugmaker climbed 30 percent to $114.51 at 4 p.m. New York time in the biggest single-day rise since Nov. 1, 2007. The Food and Drug Administration on Dec. 20 cleared sales of orenitram for the treatment of pulmonary arterial hypertension to improve exercise capacity in some patients.

The approval was Silver Spring, Maryland-based United Therapeutics’ fifth for a pulmonary hypertension treatment, Roger Jeffs, the company’s president and chief operating officer, said in the statement. The FDA had rejected the oral version of the therapy twice before, in March and in October 2012.

“This is a surprise,” not only because an FDA decision on the drug wasn’t expected until February 2014, said Cowen & Co. analyst Phil Nadeau in an investment note today, “but also because orenitram has been twice denied FDA approval, and United Therapeutics has produced no new clinical data to support the filing.”

Nadeau rates the shares “outperform,” and said he expects the approval to generate $200 million to $300 million in sales.

The decision will further “our mission of providing a wider choice of PAH therapies for physicians and patients,” the CEO said in the statement. “We are grateful for the FDA’s thorough review and will continue to build clinical support for the use of orenitram.”

The pill’s active ingredient, treprostinil, is the same as in the company’s approved injection and inhalation solution for PAH, a life-threatening disorder, United Therapeutics said.

The shares had gained 64 percent for the year through last week.

--Editors: Angela Zimm, Andrew Pollack