The Kazia Therapeutics Ltd (ASX: KZA) share price has today smashed its 52-week high on news that the United States Food and Drug Administration (FDA) has awarded a grant for Kazia's flagship drug. The oncology-focused biotech company has gained 46.83% and is currently trading at 82 cents.
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What does Kazia do?
Kazia is an Australian oncology company that develops innovative, high impact drugs for cancer. Its lead program is paxalisib, which is being developed to treat glioblastoma, the most common and most aggressive form of primary brain cancer in adults.
The company is dual listed and also trades on the Nasdaq, with its headquarters in Sydney, Australia. Kazia collaborates with leading scientists, clinicians, and investors around the world to further its products.
Kazia has stated that while there is some early stage evidence that one of its drugs may have a role to play in coronavirus infections, they do not intend to divert focus away from their core work in oncology. Kazia has advised that COVID-19 has not had an impact on any of its operations, including ongoing clinical trials.
New grant
It was announced this morning that the FDA has awarded rare pediatric disease designation (RPDD) to Kazia's flagship drug paxalisib. It will be used for the treatment of diffuse intrinsic pontine glioma, a rare and highly-aggressive childhood brain cancer. This is a great step forward for the company as with RDPP granted, Kazia may now be eligible to receive a rare pediatric disease priority review voucher (PRV), which bodes well for the Kazia Therapeutics share price.
A PRV grants the holder an expedited 6-month review of a new drug application by the FDA. PRVs can be sold to other companies and have historically commanded prices between US$68 million and US$350 million. The designation was awarded following positive emerging preclinical data in patients with the disease.
Shareholders will be eagerly awaiting the initial clinical efficacy data that is expected in the first half of FY21. Positive clinical data may substantially enhance the likelihood of a potential future PRV.
Foolish takeaway
The news is excellent for Kazia shareholders, with the Kazia Therapeutics share price today smashing its 52-week high to hit $1 in intraday trade.
Nevertheless, while this is good news there is still a lot of work before the drug is market ready and can generate meaningful profits.
The Kazia Therapeutics share price currently sits at 82 cents, giving the company a market capitalisation of $77.57 million.
