Discovery Labs Holds Out Hope for Surfaxin

But importantly, nowhere in Monday's press release does Discovery say that Surfaxin, as it is currently manufactured, can pass these new or strengthened tests in order to appease the FDA.

Ultimately, that is what really matters.

Even under Discovery's best-case scenario, Surfaxin's approval likely won't happen until the fall, which delays entry again into what is a relatively small commercial opportunity. It also makes it more likely that the company will raise money before another FDA review is completed.

Discovery shares were up 48 cents, or 33%, to $1.93 in recent trading Monday.

Know What You Own: FDA filings, approvals and rejections can swing a small-cap health care stock to the upside or downside. PozenPOZN shares recently jumped on approval of its migraine drug Treximet, with which Pozen is partnered with GlaxoSmithKlineGSK; but shares of MedarexMEDX were hit when the company announced that it, along with partner Bristol-Myers SquibbBMY, would delay an FDA filing for its melanoma drug ipilimumab.