This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Surprising Approval for Vanda's Fanapt

Stocks in this article: VNDA

Vanda has been resisting Tang's efforts, but after Wednesday, the proxy fight seems moot. Vanda has an approved drug for schizophrenia that will compete in a $23 billion market for antipsychotic drugs, according to IMS Health.

And Tang, instead of fighting for Vanda table scraps, gets to enjoy the whole meal with an extra dessert now that its stake in the company has risen in value exponentially.

Also benefiting from Wednesday's Fanapt approval was RA Capital. The Boston-based hedge fund owns 1.54 million shares of Vanda, or 5.8% of the company, according to Securities and Exchange Commission filings. RA Capital was hit hard last week by the steep drop in the value of genetic test maker Sequenom (SQNM).

It will be interesting to see if Vanda can sustain the stunning gains made in its stock price Wednesday night given what might be a tough competitive sales environment for Fanapt.

The FDA's approval of the drug was based on two studies in which Fanapt performed better than placebo, but the drug doesn't stack up as well against existing schizophrenia treatments, including Johnson & Johnson's (JNJ) Risperdal and Pfizer's (PFE) Geodon.

Risperdal is now sold in a generic form, which means Fanapt faces a low-priced competitor at a time when the recession is forcing patients to cut back on drug spending. And the drug was never compared against AstraZeneca's (AZN) Seroquel, the leading antipsychotic drug used to treat schizophrenia.

Vanda shares rose 625.9% to $7.84 in Thursday trading.

At the time of publication, Feuerstein's Biotech Select model portfolio had no positions in any stocks mentioned.

Adam Feuerstein writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

2 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,778.15 +421.28 2.43%
S&P 500 2,061.23 +48.34 2.40%
NASDAQ 4,748.3960 +104.0840 2.24%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs