CervoMed Stock Surges On FDA Orphan Drug Nod For FTD Treatment: Retail Optimism Rekindled
The Orphan Drug status provides CervoMed with several key benefits, including tax credits for clinical trial costs, regulatory assistance, and seven years of post-approval market exclusivity.
FollowShares of CervoMed Inc. ($CRVO) jumped more than 12% in pre-market trading on Wednesday, on course to snap a two-day losing streak, and grabbed retail attention.
The company announced that its oral investigational drug, neflamapimod, was granted Orphan Drug Designation by the U.S. Food and Drug Administration (FDA) for the treatment of frontotemporal dementia (FTD).
Neflamapimod, currently undergoing a Phase 2b study in patients with early-stage dementia with Lewy bodies (DLB), is showing promise in targeting specific pathogenic mechanisms associated with FTD.
The designation recognizes the drug’s potential to address a rare condition affecting approximately 50,000 to 60,000 people in the U.S., with a higher prevalence in Europe and potentially in Asia and Latin America.
John Alam, CEO of CervoMed, highlighted the significance of this milestone, noting that the company is actively working with clinical experts to design a proof-of-principle study for FTD while preparing to move neflamapimod into a Phase 3 trial for DLB in mid-2025.
The Orphan Drug status provides CervoMed with several key benefits, including tax credits for clinical trial costs, regulatory assistance, and seven years of post-approval market exclusivity.
Analyst Jason Kolbert from D. Boral Capital maintained a ‘Buy’ rating on the stock, setting a price target of $34, which implies over four times upside from the stock’s previous close.
CRVO sentiment and message volume Nov 27 premarket as of 9:15 am ET | source: Stocktwits
On Stocktwits, the sentiment surrounding CervoMed shifted dramatically from ‘bearish’ to ‘extremely bullish,’ with a surge in message volume reflecting renewed optimism among retail investors.
While CervoMed’s stock has dipped 0.25% year-to-date, the latest news has reignited investor interest, propelling the stock to among the top 15 trending symbols before the bell on Wednesday.
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