Human Genome Sciences ( HGSI) provided biotech's biggest summer shocker Monday with positive results from a phase III study of the lupus drug Benlysta.

The news drove Human Genome shares up 226.2% to $10.83 in recent trading. Shares of Benlysta partner GlaxoSmithKline ( GSK) were up 3.5% to $37.63.

Thoughts and observations stemming from the announcement:

Second Study

The big question for Human Genome is whether the success in the first phase III study of Benlysta predicts a win in the second phase III study, results of which will be announced in November. The positive BLISS-52 study enrolled patients primarily in Asia, South America and Eastern Europe. The study still under way, known as BLISS-76, is treating patients mainly from North America and Europe. Other than that, the studies are largely identical.

The placebo effect in the BLISS-52 was high (44% of placebo patients responded), so with treatments of lupus patients generally better in Western countries, will this hurt Benlysta's chances in BLISS-76?

Human Genome officials spent a good amount of time addressing this question on the company's conference call this morning. Simply put, the company is confident that BLISS-52's success bodes well for BLISS-76 results in November.

The evidence to back up that confidence is substantial. The results from BLISS-52 were very strong, so the drug has a lot of wiggle room just in case, for instance, placebo patients perform even better. Human Genome deserves a lot of credit for a well-designed study, including conceiving a novel primary endpoint that seems to have finally cracked lupus where previous studies failed.

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