Noxopharm (ASX:NOX) is up over 100% after getting Orphan Drug Designation – but is it that big a deal?

Noxopharm (ASX:NOX) is the ASX’s biggest winner, climbing as much as 166% higher than it closed yesterday. And it is all because it secured Orphan Drug Designation (ODD) for a preclinical drug candidate.

Is the share price spike justified? Or in other words, is this a big deal? Simply put, it is…but the hard work is only just beginning.

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Introduction Noxopharm

Noxopharm is a small cap oncology biotech that first listed in August 2016. It was a modest $6m IPO, but one that was very successful initially. At the time its main drug candidate in NOX-66, now known as Veyonda. The company has since taken it through multiple clinical trials, including a successful Phase 1 trial.

It has been an eventful several years with the company picking up two technology platforms, spinning off its non-oncology assets into Nyrada and a foray into seeing if Veyonda could fight COVID-19. But the last year or so has been difficult. It ended up scaling back its Veyonda program in April (a move that led to a 45% share price plunge in one day). Although its preclinical assets using its technology platform have shown promise, they remain preclinical assets.

The coincidental Biotech Bear market hasn’t helped either.

Noxopharm (ASX:NOX) share price chart, log scale (Source: TradingView)

A new lease of life

But this morning, the company has essentially recaptured the ground it lost over the last several months. The FDA granted Noxopharm’s CRO-67 preclinical drug candidate Orphan Status. This means it maty be entering the clinic soon and it will have help such as tax credits and the promise of 7 years market exclusivity after approval. This is no easy feat with just 2 other Australian companies receiving this status, out of a total of 260 which applied.

Shareholders have every right to be excited, but long-term holders could well attest to the fact that these things take plenty of time. But there’s no denying that it has taken a significant step forward, even if there’ll be many more to take before the company reaches its ultimate destination.

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