MARLEY SEAMAN

NEW YORK (AP) ¿ Shares of Vanda Pharmaceuticals Inc. surged Thursday after the Food and Drug Administration approved Vanda's schizophrenia drug Fanapt, following a delay of more than nine months.

In July, Vanda said the agency declined to approve Fanapt. It asked Vanda to compare the drug to a similar product, like risperidone, and also requested new safety data. That news sent Vanda shares plunging, and Thursday, they more than recovered from their losses.

In afternoon trading, the stock advanced $6.40, to $7.48. Earlier it peaked at $10, its highest level since November 2007. More than 9 million shares changed hands, which is far above the stock's 100-day average of 122,000 shares.

Vanda said Fanapt may have safety advantages over similar drugs, pointing to the fact that among trial patients, rates of tremors, restlessness, and weight gain were low, and no elevation in cholesterol or triglycerides were seen.

Vanda said it expects to start shipping the drug later this year. The company said it will consider a partnership in bringing Fanapt to market, but will look at other options as well.

In a note to clients, Natixis Bleichroeder analyst Corey Davis said the decision was "one of the most surprising moves we've seen out of the FDA this year." He said Fanapt should have patent protection until 2016 or 2017, and doctors may be willing to switch patients on other drugs over to Fanapt.

He also wrote that Fanapt "arguably has one of the most benign safety profiles of all the (atypical antipsychotic drugs) out there," comparing it treatments like risperidone. Davis upgraded Vanda stock to "buy" from "hold," and lifted his price target to $12 per share from $1.

After Vanda announced the approval, the company said Tang Capital Partners ended its attempt to gain control of Vanda and liquidate it. Tang withdrew a slate of candidates for Vanda's board, halting a proxy contest.

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