Panbela Therapeutics Inc. witnessed a dramatic surge in its stock price following upbeat news from the U.S. Food and Drug Administration regarding a potential treatment for childhood cancer. The FDA granted approval for US WorldMeds’ new drug application employing eflornithine as a therapy for high-risk neuroblastoma patients—a rare form of cancer originating from immature nerve cells, contributing to nearly 15% of pediatric cancer fatalities.
Panbela had previously divested some of its assets in the eflornithine pediatric neuroblastoma program to US WorldMeds in a deal entailing milestone-related payments linked to development, approval, and sales.
Jennifer Simpson, Panbela’s Chief Executive, highlighted the significance of the FDA’s approval, foreseeing substantial developmental milestone payments for Panbela as US WorldMeds progresses in bringing eflornithine to market.
The stock price of Panbela surged 60.4% in midday trading Tuesday, building upon a 121% increase the day prior, marking a cumulative gain of 254% over two days.
Trading volumes soared to a record-breaking 146.9 million shares on Monday and reached 74.1 million shares by midday on Tuesday, significantly surpassing the typical daily average of approximately 5.2 million shares.
Simpson underscored the potential of polyamines in cancer therapy, pointing towards ongoing programs in various cancer types and the advancement of pre-clinical programs in additional areas like ovarian and multiple myeloma.
However, Panbela has faced financial uncertainties previously, as indicated in its quarterly and annual filings, expressing doubts about its continuity as a “going concern.” The company executed two reverse stock splits this year to meet Nasdaq’s minimum-bid listing requirement but saw its stock close at a record low of 45.7 cents on Friday.
Despite this week’s notable stock rally, the company’s stock had incurred a substantial year-to-date decline of 99.5% by Friday’s close.
Notably, the recent surge in Panbela’s stock, akin to “meme” stocks, didn’t attract as much short interest. Current data indicates short interest in Panbela’s stock at 0.86% of the public float, significantly lower compared to short interest in GameStop Corp. and AMC Entertainment Holdings Inc., well-known “meme” stocks. GameStop’s short interest was at 23.88% of its public float, while AMC’s was at 11.4%.