Two pharma stocks are making outsized moves in early trading this morning. Both Galmed Pharmaceuticals Ltd (NASDAQ:GLMD) and SAGE Therapeutics Inc (NASDAQ:SAGE) are red-hot on encouraging drug data.
Galmed Stock Triples, Notches New Record High
Galmed stock sits on top of the Nasdaq today, up an incredible 221% to trade at $22.65, and earlier touching a record high of $27.06, after the company's Aramchol met its main goals for treating nonalcoholic steatohepatitis (NASH), or fatty liver disease. The Food and Drug Administration (FDA) granted the drug fast-track status, as there is no other FDA-approved drug for treating NASH.
Short sellers could soon be scrambling for cover after today's burst. GLMD short interest has tripled since March, and the 9,000 shares sold short represents more than four days of pent up buying power, at the pharma stock's average pace of trading.
Sage Expediting Depression Drug Trials
Sage stock is up 7.7% to trade at $158.26, after the drugmaker said it will expedite late-stage trials for its depression drug, following a Breakthrough Therapy meeting with the FDA. The firm will initiate the trials in the second half of 2018.
SAGE stock has more than doubled in the past year, and today's rally has the security on track to snap a five-day losing streak. Since gapping higher in December, the shares embarked on a series of lower highs and lows, with the 320-day moving average recently emerging as support.
In the options pits, there has been a large appetite for puts in recent weeks. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day put/call volume ratio of 1.42 ranks in the elevated 80th annual percentile, meaning SAGE puts have been bought to open at a quicker-than-usual clip -- albeit amid relatively low absolute volume.
Those looking to bet on SAGE stock's short-term price action may want to consider doing so with options. The equity's Schaeffer's Volatility Index (SVI) of 49% ranks in the 2nd annual percentile, meaning low volatility expectations are being priced into short-term contracts -- a boon to potential premium buyers.