The U.S. patent office granted Galectin Therapeutics Inc (GALT.O) a patent related to its experimental treatment for chronic liver disease, sending the company's shares soaring.
The stock, which nearly doubled in value to hit a three-month high of $3.48 in morning trading, was the top percentage gainer on the Nasdaq. About 2 million shares had changed hands by 1330 ET, almost 100 times their 10-day moving average.
The patent relates to a method of obtaining the company's galectin inhibitor compound, used in its potential treatment for the fibrosis -- scarring of the liver associated with chronic liver disease.
The treatment, GR-MD-02, is currently being evaluated in animal studies, and the company aims to file an investigational new drug application with U.S. health regulators by 2012-end that will allow it to begin human studies in patients with fatty liver disease.
"Preclinical results of our candidates have shown reversal of fibrosis in rodent models of disease, particularly in ... fatty liver disease, which will be our first clinical indication for our fibrosis program," Galectin Chief Executive Peter Traber said in a statement.
Galectin is also testing GR-MD-02 in animal studies as a possible treatment for post-transplant fibrosis.
"There is a truly vast unmet medical need for liver fibrosis, with the only current treatment option being liver transplantation," Traber said.
The company's other drug candidate, GM-CT-01, is currently in mid-stage trials. It is being studied as a combination therapy in patients with advanced melanoma, a skin cancer, and also in colorectal cancer.
The stock was up 67 percent at $2.95 in early afternoon trading.
(Reporting by Balaji Sridharan in Bangalore; Editing by Anthony Kurian, Maju Samuel)