Is This Healthcare Stock a Screaming Buy After Scoring a Huge Drug Approval?
If there's one thing that can quickly send a healthcare stock soaring, it's the approval of a key drug. Not only can that give investors confidence in a business's ability to bring products to market, but it also means there's a new source of revenue for the company. This can reduce risk, especially for smaller biotechs.
One stock that's been rallying in recent weeks is Madrigal Pharmaceuticals (NASDAQ: MDGL). In March, the Food and Drug Administration (FDA) granted accelerated approval for one of the company's drugs. But the stock hasn't exactly been taking off -- it's up only 10% so far this year. Are investors overlooking this healthcare stock, and has it become a screaming buy?
On March 14, the FDA announced that it had granted accelerated approval for the first-ever treatment for liver scarring as a result of noncirrhotic nonalcoholic steatohepatitis (NASH), or fatty liver disease. The drug could be useful for an estimated 6 million to 8 million people who have NASH and moderate or advanced scarring.
Source Fool.com
