What Happened?
Shares of pharmaceutical company Amphastar Pharmaceuticals (NASDAQAMPH) jumped 5.8% in the afternoon session after the company announced it had entered into an exclusive license agreement with Nanjing Hanxin Pharmaceutical Technology Co., Ltd. for a new drug compound.
The deal was for the development and commercialization of AMP-110, a fully synthetic human hormone analog, in the United States and Canada. This compound was designed to treat inflammatory and autoimmune conditions, with the potential for an improved safety profile compared to existing products. The agreement involved an upfront payment of $2 million from Amphastar, with potential future payments of up to $14 million for development milestones and $75 million for sales milestones.
The shares closed the day at $29.41, up 6% from previous close.
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What Is The Market Telling Us
Amphastar Pharmaceuticals’s shares are somewhat volatile and have had 13 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 2 months ago when the stock gained 10.9% on the news that the stock's positive momentum continued as the company reported third-quarter financial results that surpassed analyst expectations. Amphastar posted revenue of $191.8 million and adjusted earnings of $0.93 per share, beating Wall Street's consensus estimates. The strong performance was reportedly driven by robust sales of its products Baqsimi and Primatene Mist. Following the results, analyst firm Needham maintained its 'Buy' rating on the company's stock but lowered its price target to $34 from $36.
Amphastar Pharmaceuticals is up 11.1% since the beginning of the year, but at $29.41 per share, it is still trading 23.6% below its 52-week high of $38.48 from January 2025. Investors who bought $1,000 worth of Amphastar Pharmaceuticals’s shares 5 years ago would now be looking at an investment worth $1,507.
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