Endocyte Stock Soars: Doubling in One Day

The drug producer's cancer treatment drug has had positive results on two different types of cancer.
3:00 | 03/21/14

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Transcript for Endocyte Stock Soars: Doubling in One Day
I'm -- -- new York and as. Actually first it's a -- stock and today. We're looking at and outside the small drug maker had a very big -- doubling. Its price of stock to explain now -- their -- of finance Eric what happened and a site that. How did and a -- got huge -- is a very good news for which an experimental drug. I believe it's called it the full allied I'd never heard -- before today probably most of us hadn't either because it's not on the market currently its experimental drug. Did a very positive phase two trial here in the United States as a treatment for lung cancer. And meanwhile over in Europe Europe's equivalent of the FDA. Recommended conditional approval of the drug as a treatment for ovarian cancer so one drug as a potential treatment for Q very serious cancers. And you can see. The reaction in the stock market the stock almost -- today it was a huge upside ya wanna -- the stock price over the past two days just got to put it side by side comparison to this when we can pull it up. We have a chart up there. -- explosive right he has that's a that's a pretty amazing that restoration and just 24 hours. It again this is all a matter of to the potential for FDA approval right. Yeah there -- still a long way from getting FDA approval as this is -- for lung cancer. Begin it was a feast -- trial it was a large trial meaning there -- -- you know there's big number of patients in the trial. And the results were very positive. This is the track you need to be on to ultimately get FDA approval there's no guarantee they will get -- -- that's a risk if you're investor but. This was very very positive news and then again over in Europe. There are saying we think this probably should get approved an achievement for ovarian cancer so one drug treats you cancer you can imagine. The potential market for this if it. Does prove successful in subsequent trial and -- -- keep in Iowa so we did some research on this and it's been a bit of a roller coaster after the company and that's. Signature drive five months -- -- shares fell. Because it -- into work any better lung cancer patients than one drug that was already in use so. If that's the case but now you've got conflicting reports kind of coming back and forth into the count those kinds of results. Com investors sort of put aside those reports that happened five months ago has focused on -- -- now. 00 -- they put that aside he said well forget that's old news. We've got this new trial I mean and and this is you know again typical scenario for an experimental drug you do multiple trials and you hope that each trial. The test results get better and better and better and ultimately in the FDA gives you approval so the fact they had that that child five months ago obviously was a negative for the stock but. They're not done at that point they -- they come back -- -- the drug they -- a different type of trial perhaps on a different. For type of lung cancer itself. And this specific trial was very non small cell and I'm not the doctors -- -- and pretend to be type of lung cancer but. Again the results were. Unambiguously positive. And so that was already gonna give the stock a rocket -- this morning and then again the EU saying for ovarian cancer we -- what we've seen with this drug so it it. It with a -- that this could be a platform. Drug meaning a drug that can treat multiple kinds of diseases and the the markets for those in the potential revenue for those are human. Yes well so if you had and aside before today you're fit -- you know obviously feeling pretty good about how things have been performing for your portfolio. But when these kinds of reports -- -- I mean how quickly if I want to get in on it too if I want to get. It on it now. Clearly I can't speak today -- Friday. It's right I think you are we what are what are typically historically and again I -- this is not getting an abacus -- -- -- -- and -- and outside or to sell it now it at that. But historically speaking that when we how these kinds of reports coming out what is the -- opportunity typically. For big pharma companies -- small groups walk up. You know these these smaller buyouts. Companies -- it's really kind of a lottery ticket right I mean this could be the peak rate friend aside big the next Trout can be really bad in the FDA could. Deny them for whatever reason and then the stocks gonna collapse. But if this drug proves to be. At as valuable as the investors today are suggesting it could be then this is just the beginning and that's really that's why there's so much excitement around by attack. -- part because then the medicines that they're creating are are so much better than they with the UC -- to create. And because if you get it right eight. These the other stock could just be getting started -- -- look at you know over the past it like Genentech -- Biogen. They started out like and -- site as well small experimental drug companies that became huge multi billion dollar companies. Because they have one or -- drugs that were able to be successful. So. From my advice to people that unless you are a doctor. Or feel very strongly that you understand the science. You should play these -- speculative part of your portfolio. Right you you don't -- -- put all your eggs in any one basket and you deathly no one put -- in the Biotech basket because. The risks are very high and it's a high risk reward scenario right you could be -- at. You know stuck that's gonna go up ten times from here -- stock that's gonna be gone. -- a year Q if things don't work out sage advice Aaron task of finance Aaron -- so much appreciate the time. -- watching a story stock they would ABC news dot -- related headlines.

This transcript has been automatically generated and may not be 100% accurate.

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