Why Sorrento Therapeutics Stock Is Ripping Higher Today

Shares of the mid-cap biotech Sorrento Therapeutics (NASDAQ: SRNE) jumped by as much as 20.6% in premarket trading Friday morning. The company's shares are bolting higher in response to the news that its wholly owned subsidiary SmartPharm Therapeutics had landed a $34 million contract from the Defense Advanced Research Projects Agency (DARPA) to develop a rapid countermeasure against COVID-19.

This initial round of funding will reportedly be used to support the development of the SARS-CoV-2 neutralizing antibody STI-2020 (aka COVI-AMG) through phase 2 studies. In preclinical studies, hamsters treated with STI-2020 experienced a dramatic reduction in viral load compared to animals in the control group, according to Sorrento.

Sorrento's highly diverse COVID-19 pipeline attracted investors in droves earlier this year. After the company fell well behind the pack from a developmental standpoint, however, its shares clearly lost a fair amount of their appeal.

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Source Fool.com