Array Biopharma Inc(NASDAQ: ARRY)
Array Biopharma started the week off strong before declining through yesterdays trading session and continuing those declines today. Now the question is, “Should investors be concerned about ARRY declines?�? Today, Ill do my best to answer that question.
Why ARRY Skyrocketed
Before we get into why Array Biopharma is declining and whether or not you should be concerned, its important to know exactly why the stock spiked. With that said, earlier in the week, ARRY released positive data with regard to its skin cancer study. The study was a Phase 3 clinical trial that surrounded binimetinib, a drug designed to treat pateints with NRAS-mutant melanoma. During the trial, Array Biopharma compared the effects of binimetinib to the effects of chemotherapy dacarbazine, the current standard of treatment. The study found that on binimetinib, patients lived for an average of 2.8 months before the cancer progressed. This is overwhelmingly positive news when compared to the 1.5 month progression free survival rate associated with chemotherapy dacarbazine. As a result of the positive data ARRY is expected to submit a new drug application to the FDA within the first half of next year. In a statement ARRY CEO, Ron Squarer had the following to say
“We are excited to announce positive results from the NEMO trial, which suggest binimetinib has the potential to provide an important new treatment option for patients with advanced NRAS melanoma We look forward to discussing the data with the FDA and other regulatory agencies in the near future.�?
As we would expect following such positive news ARRY skyrocketed, gaining more than 20% in a single trading session.
Why Were Seeing Declines Now
Currently (10:10) ARRY is trading at $4.51 per share after a loss of 2.49%, and thats proving to be a cause for concern among investors. Nonetheless, I dont think investors should be concerned. In fact, what were seeing today is nothing more than normal market movement. In the market, price movement tends to happen through a series of overreactions. Therefore, the 20% gain in the market following the positive news was likely a slight overreaction, leading to a correction thats bringing the price of ARRY down to a more sustainable rate before growth continues.
What We Can Expect To See Moving Forward
Moving forward, I have incredibly positive expectations for what were likely to see from ARRY. While the stock is realizing losses today, the movement were seeing in the market is nothing more than a natural trend. Considering the overwhelmingly positive data we saw from the Phase 3 clinical trial of bitimetinib and the fact that the company already announced that it is excited to work with the FDA and likely to submit a new drug application in the first half of 2016, we have quite a bit to look forward to. As a result, Im expecting to see a little more by way of declines. From there, we should see slow and steady gains on ARRY until the FDA submission, which will likely prompt a big spike in the value of the stock.
What Do You Think?
Where do you think ARRY is headed and why? Let us know your opinion in the comments below!
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Article Source: Array Biopharma (ARRY) Declines: Should You Be Concerned