The AdAlta Ltd (ASX:1AD) share price is rocketing today following the positive news on its drug trials. In mid-morning trade, the biotech company's share price is soaring 31.4% higher to 23 cents.
However, at the time of writing, the AdAlta share price has retreated slightly to 20 cents, up 14.29%. Also, it's worth noting that the AdAlta share price reached a 52-week high of 26.5 cents in the opening minutes of trade.
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Quick take on AdAlta
Established in 2006, AdAlta is a clinical-stage biotechnology company. The company's focus is on researching and developing protein-based therapies. Thus, AdAlta utilises a range of unique compounds, known as i-bodies, to create a pipeline of drugs to treat serious diseases. This includes idiopathic pulmonary fibrosis (IPF) and other human fibrotic diseases.
What did AdAlta announce?
The AdAlta share price is racing higher as investors are fighting to get a parcel of its shares.
In this morning's release, AdAlta advised it has been granted Orphan Drug Designation (ODD) from the United States Food and Drug Administration (FDA). In particular, this is for its lead product candidate AD-214.
The Orphan Drug Act, created by the FDA, aims to motivate biopharmaceutical companies in developing potential medicines for rare or 'orphan' diseases. The ODD provides preferential treatment that enhances a company's standing with the agency. It is estimated that rare and orphan diseases affect around 200,000 people in the United States alone.
The welcomed decision enables the company to receive special benefits of achieving incentivised targets. This includes eligibility for seven years of market exclusivity after FDA approval and discounted tax credits of 50% of drug testing costs. Benefits also include additional protocol assistance, reduced review times, and specific marketing authorisation application fees waived.
This follows the company's previous ODD for AD-114, the predecessor molecule to AD-214.
AdAlta noted that receiving ODD will bring extra economic value for AD-214. This will flow onto its future commercial partners.
About the AdAlta share price
In the past year, the company's shares have accelerated to give investors a gain of more than 180%. In March, the AdAlta share price traded for as little as 4 cents, before gradually increasing over the 11 months. However today, the biotech's shares reached a 52-week high of 26.5 cents.
Based on the current share price, AdAlta commands a market capitalisation of roughly $51 million.
