Biopharma company Provention Bio (NASDAQ:PRVB) bagged the U.S. Food and Drug Administration’s (FDA) approval for its Tzield (Teplizumab) medicine that delays the onset of stage 3 Type 1 diabetes in patients aged eight years and older with stage 2 Type 1 diabetes. Provention Bio stock rallied over 10% in Friday’s pre-market trading in reaction to the news.
This first-of-its-kind medicine should be given through intravenous infusion over a minimum of 30 minutes once a day for 14 days. In Type 1 diabetes, the patient’s immune system attacks the insulin-producing beta cells in the pancreas. The monoclonal antibody Teplizumab binds to a specific cell surface antigen (CD3) to deactivate the immune cells that attack the insulin-producing beta cells.
Last month, Provention Bio announced a co-promotion agreement with Sanofi (SNYNF), under which Sanofi will commit commercial resources in the U.S. for the launch of Teplizumab. Meanwhile, Provention will reimburse field force-related expenses incurred by Sanofi to commercialize Teplizumab.
For a one-time upfront payment of $20 million, Provention granted Sanofi an exclusive, one-time right of first negotiation to obtain exclusive global rights to commercialize Teplizumab. Further, as per the deal, Sanofi can buy up to $35 million of Provention’s common stock following Teplizumab’s FDA approval.
Is Provention Bio, Inc. a Buy, Sell, or Hold?
Provention Bio stock has surged nearly 47% year-to-date backed by favorable developments for its diabetes drug. Wall Street’s Strong Buy consensus rating for PRVB stock is based on four Buys and one Hold rating. The average PRVB price target of $16.40 implies 99% upside potential from current levels.