Aimmune Shares Explode on Peanut Allergy Treatment Approval from FDA

Aimmune Therapeutics saw its shares flying on Monday after the company gained Food and Drug Administration (FDA) approval for a first-of-its-kind peanut allergy treatment.

In premarket trading on the stock market today, AIMT shares soared 9.2%, nearing 33.90.

The FDA has approved Aimmune’s Palforzia for patients ages 4-17 with a confirmed peanut allergy. The drug works by exposing patients to an increasing level of the peanut protein over time with the goal to mitigate allergic reactions that could occur with accidental exposure.

“Both the REMS (Risk Evaluation and Mitigation Strategy) program and Palforzia’s black box warning for anaphylaxis are expected and typical of any product in their class,” RBC Capital Markets analyst Brian Abrahams remarked. The firm reiterated an “outperform” rating on the stock. The peanut allergy treatment will have a wholesale cost of $890 per month, Abrahams said.

Aimmune’s drug gained approval with a REMS drug safety program. Drugs with this requirement have to hit certain safety criteria to ensure the benefits of the medicine outweigh the risks.

The treatment also comes with a label warning of potential anaphylaxis. For this reason, patients must be monitored for an hour after first taking a larger dose of Palforzia.

According to Credit Suisse analyst Evan Seigerman sees a potential $1.2 billion in peak sales for Palforzia. “This view is in line with recent comments from management suggesting that it could take up to six quarters to get ‘good formulary coverage,’ something we view as essential for a successful drug launch,” he said in his note.

Disclaimer: We have no position in Aimmune Therapeutics Inc. (NASDAQ: AIMT) and have not been compensated for this article.