Shares of Clinical Data Inc CLDA.O rose as much as 69 percent in early trade on Monday as potential blockbuster antidepressant Viibyrd received U.S. health regulators' nod on Friday, increasing expectations of finding a partner for the oral drug.
In a conference call with analysts, Chief Executive Andrew Fromkin said the company was looking for a partner and had discussions with a number of parties over the last few months.
The company also said European approval process of the drug would depend on partnering discussions.
The Newton, Massachusetts-based biotech and diagnostics testing firm said it expects to make the oral drug available in the U.S. by the second quarter of this year.
The company would expand its sales force through its own efforts or through partnership within one year of launch.
BMO Capital Markets analyst Robert Hazlett said, "The Viibryd approval materially increases the likelihood of a major alliance with another pharmaceutical company to market the promising therapy, and/or the potential of an outright purchase of Clinical Data."
CEO Fromkin expects the drug's rest of the world market opportunity to be a little-less-than double the US market, with EU accounting for a third.
US patent for Vilazodone, the compound that will be sold under the brand Viibryd, expires in June 2022. The European patent will expire in May 2022.
Analysts expect the drug's unique dual mechanism of action to differentiate itself from existing and upcoming treatments.
"Its safety profile will make it a likely choice for those with sexual side effects," Piper Jaffray analyst Edward Tenthoff wrote in a note.
While Tenthoff sees 2011 sales of $46 million and peak sales of $632 million in the long term, he says Viibyrd sales could exceed $1 billion with further data in treatment failures and a larger marketing force.
The Food and Drug Administration approved Viibyrd at doses of 10 milligrams, 20 mg, and 40 mg for major depressive disorder, or major depression.
Clinical Data's shares were up 55 percent at $23.30 in early trade on Monday on Nasdaq. They reached a year-high of $25.35 earlier in the session. (Reporting by Shravya Jain in Bangalore; additional reporting by Anand Basu; Editing by Maju Samuel, Sriraj Kalluvila)