Optimer Pharmaceuticals ( OPTR) proves that even in a bear market, small biotech stocks are still capable of doubling in price overnight. Shares of Optimer, a pick in my Biotech Select model portfolio, soared 90% Monday night after the San Diego-based company reported positive top-line results from a pivotal phase III study of its experimental antibiotic OPT-80 in patients infected with the hospital-borne infection Clostridium difficile. OPT-80 achieved cure rates that are statistically equivalent to Vancocin, the only Food and Drug Administration-approved treatment for Clostridium difficile, or C. diff for short. Better yet, OPT-80 significantly reduced the recurrence of C. diff compared to Vancocin, which is marketed by Viropharma ( VPHM). C. diff is a scary bacterial superbug that causes severe abdominal pain, bloating and diarrhea. In severe cases, the C. diff bug can rupture colons, cause blood infections and lead to death. Like the better publicized staph infection known as MRSA, the rate of new and recurrent C. diff infections are on the rise across the U.S. and the rest of the world. Hospitals are struggling to keep new infections under control. Two antibiotics used to treat C. diff -- Vancocin and metronidazole (used off label) -- do a relatively good job of curing patients, but the relapse rate -- once treatment ends -- is high.
Optimer's experimental drug OPT-80 is designed to match the cure rate of the current C. diff drugs with a more convenient twice-daily dosing schedule. More importantly, earlier data suggests that OPT-80 could significantly cut the recurrence rate of C. diff infections.