(Bloomberg) — Two biopharmaceutical companies enjoyed a meme-like day on Monday, surging at least twofold on promising results.
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Veru Inc. more than tripled intraday in its biggest jump ever with more than 293 million shares changing hands, by far a daily record. The gains come after a late-stage study of the drug developer’s experimental medicine for some of the sickest Covid-19 patients ended early because of signs of “overwhelming efficacy,” according to a company statement.
Separately, penny stock Hoth Therapeutics Inc., which was named after a Star Wars ice planet, more than doubled after study results from North Carolina State University showed its experimental treatment helped clear tumor cells in mice. Its trading volume was more than 200 times its three-month average.
Monday’s action shows there’s still interest in speculative assets with investors once again dashing in and out of meme stocks. A group of such shares tracked by Bloomberg surged last month from a bottom. The volatile biotechnology sector has in particular drawn retail interest as elevated risks can also lead to big gains.
Veru’s results look like the kind of breakthrough a trader dreams of, which is all the more unusual because the Miami, Florida-based company makes the bulk of its revenue from female condoms.
The stock jump is a boon for its top two shareholders, Mitchell Steiner, the company’s chief executive and chairman, as well as Harry Fisch, chief corporate officer and vice chairman. Steiner’s most recently reported stake is worth about $96 million while Fisch’s is worth roughly $104 million, according to Bloomberg-compiled data.
Hoth declined to comment on its stock price while Veru didn’t immediately respond to a Bloomberg request for comment. Veru traded as high as $14.57 per share on Monday and Hoth touched $1.63, the highest since Jan. 4.
Veru still has to get an emergency use authorization for Covid treatment at a time when regulators are pulling back on some previously authorized treatments, and Hoth will likely take years before it can show a real effect in cancer patients. Analysts, however, are universally positive on the pair.
Veru has five buy ratings and Hoth has two. Neither have received hold or sell recommendations.
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