Check-Cap (CHEK) nearly tripled on Monday after the medical-diagnostics company said the U.S. Food and Drug Administration approved its investigational device exemption application, clearing the way for a study of its C-Scan polyp-detection test.
Shares of the Isfiya, Israel, company at last check were at $3.17, compared with their Friday close at $1.53. They've traded on Monday at as much as $4.49. In November they were trading at a 52-week low 24 cents.
C-Scan is a screening test to detect polyps before they transform into colorectal cancer.
It is intended for candidates who are at average risk for colorectal cancer; who are poor candidates for colonoscopy or decline colonoscopy, or who had an incomplete optical colonoscopy.
The system works this way:
A patient swallows a capsule that contains x-ray technology and electronics. The capsule travels through the GI tract and scans the inner lining of the colon. A second element of the system records and stores the scanning data.
When the scanning concludes, the patient is notified. The patient will pass the capsule naturally. And the data are analyzed with Check-Cap's proprietary software.
The FDA clearance permits Check-Cap to begin a study to evaluate C-Scan's safety and performance, as well as subject compliance with C-Scan.
The application clearance, Chief Executive Alex Ovadia said in a statement, "is a significant milestone for Check-Cap."
"We are in active discussions with a number of clinical sites as part of our preparations to begin the pivotal study in late 2021," he said.
Ovadia said the company was collecting additional clinical data at Israeli sites. It is gearing up to initiate a study in Israel at more than 10 clinical sites to enroll up to 250 average-risk patients.
The company said that every year nearly 935,000 people die from colorectal cancer and more than 1.9 million new cases are identified.
The disease typically begins as precancerous polyps or abnormal growths in the colon or rectum, which can be present for up to 10 years before developing into invasive cancer.
As a result, Check-Cap said, screening for polyps before they turn into cancer is the most direct method to prevent the disease.
The FDA could see big changes under the presidency of Joe Biden, according to FDA expert Aaron L. Josephson, an FDA expert at the law and consulting firm Mintz, who closely follows the regulation of medical devices, pharmaceuticals and vaccines.