Shares of Medarex Inc (MEDX.O) rose as much as 22 percent Monday on a Mayo Clinic report that two prostate cancer patients became cancer-free after being treated with the company's experimental drug, ipilimumab, in combination with other therapies and surgery.
On Friday, the Mayo Clinic said both patients experienced reduction in levels of a protein called PSA, or prostate specific antigen, and tumor shrinkage after receiving one dose of ipilimumab, which allowed them to be treated with surgery.
The two patients had tumors that were considered inoperable at diagnosis, the Mayo Clinic said.
Patients in the mid-stage study were being treated with ipilimumab in combination with hormone treatment and radiation therapy.
"It is really the headline itself of these dramatic responses irrespective of the patient number that is driving the stock at this point," Merriman Curhan Ford analyst Joseph Pantginis said.
The Mayo Clinic published the report about the study in its online research magazine, Discovery's Edge.
"Certain caution is warranted... It is very different from a publication in a peer review medical journal, which usually goes through critical review by other experts," BMO Capital Markets analyst Jason Zhang said.
"Both patients received hormonal therapy. Although hormonal therapy typically does not yield this type of response, one can't exclude the possibility that the therapy has contributed to the outcome," Zhang added.
Ipilimumab is an antibody that is being developed by the company with Bristol-Myers Squibb Co (BMY.N) and is in trials for melanoma, lung cancer and prostate cancer.
"We think the melanoma is the lead product and the big value driver. The news today shows the potential activity of ipilimumab," Needham & Co analyst Mark Monane said.
"But to get real college credit, they have to do it with more than two patients. It is 108 patient trial and it is ongoing and we look forward to hearing those results," Monane added.
Medarex and Bristol-Myers recently initiated a late-stage trial with ipilimumab for prostate cancer. For the mid-stage study conducted by Mayo Clinic, Medarex provided the drug and supported safety monitoring during the protocol.
Shares of Medarex were up more than 17 percent at $8.65 Monday afternoon on Nasdaq. They had touched a high of $9.01 earlier in the session. Shares of Bristol-Myers were down little more than 1 percent at $20.30 on New York Stock Exchange.