Adagio Therapeutics, Inc. (NASDAQ: ADGI) following its inactive trade session yesterday, netting in a 1% gain, exploded in the premarket. Total growth for the stock continued upwards of 78%, pushing up its price to an impressive $6.68, earlier today. It has been on a persistent bearish slide since early February, losing a total of 47.55% since. The recent growth spurt has pushed market bulls into action, anticipating further growth to reverse prior losses. The clinical-stage biopharma company is one that specializes in antibody treatment, whilst particularly focusing its research on Covid-19 treatment. Its current price surge links to
Adagio’s Antibody Treatment meets all Trial Objectives
This morning brought the announcement of Adagio’s breakthrough in its phase 2/3 trials. The company had announced that all primary objectives from the trials had successfully been achieved. This candidate is an antibodies-based treatment with the primary objective of treating different Covid-19 variants. Within the recently published trial, the candidate was 75% effective at eliminating symptomatic Covid-19 transmission risk, in post-exposure prophylaxis. Similarly, the effectiveness level in a pre-exposure context amounted to 71%.
These results demonstrate immense promise and showcase the value of Adagio as a potential mainstream treatment in the short-term future. As the world transitions towards the post-Covid territory, these treatments are likely to surge in demand, and with them the price of Covid treatment stocks such as ADGI. It is no surprise why bulls in the market have increasingly been taking long positions with the stock.
ADGI Prospects and Risks
ADGI, as is typical of every pharmaceutical stock, is one that inherently holds risk, given the nature of clinical trials. However, the recent trial results significantly diminish the probability of failure, as the treatment’s efficacy is established as robust. In light of this, the stock is presumably likely to rise as milestones continue to clear. The high-risk phase of the trials is increasingly becoming a thing of the past.
However, it is important to point out that this breakthrough does not mean a complete risk elimination for the candidate. Further studies that go beyond effectiveness and point to patient safety and side effects are highly critical for success. These risks are yet to actualize, which will surely impact the ADGI trajectory.
Conclusion
ADGI underwent a heavy surge in today’s pre-market following a successful trial announcement. The company’s candidate treating Covid-19 through an antibody-based drug achieved all efficacy objectives. However, ambiguity exists regarding future risks of safety and side effects.
