Top 5 Upcoming FDA Decisions With Bullish Options Sentiment

by: Kapitall

The following is a list of 5 FDA decisions with bullish options sentiment.

To create the list, we started with a universe of biotech stocks that have FDA decisions scheduled over the next month. We then narrowed down the list to focus on the top 5 stocks in terms of the Put/Call ratio (based on open options positions).

In other words, all of these stocks have large call option open interest relative to put option open interest, i.e. more bullish options sentiment, ahead of these FDA decisions.

FDA calendar data sourced from RTT News, options data sourced from Schaeffer's.

1. Ista Pharmaceuticals Inc (ISTA): FDA action on once-daily XiDay as a treatment for ocular inflammation and pain following cataract surgery scheduled for October 16. Call open interest at 360 contracts vs. put open interest at 26 contracts (Put/Call ratio at 0.07). ISTA expects sales from its Xibrom franchise, including XiDay, to be in the range of $95 million to $105 million.

2. Alexza Pharmaceuticals Inc. (NASDAQ:ALXA): FDA decision on AZ-004 for the rapid treatment of agitation in patients with schizophrenia or bipolar disorder scheduled for October 11. Call open interest at 8,855 contracts vs. put open interest at 2,158 contracts (Put/Call ratio at 0.24). AZ-004 sales could reach $272 million by 2015, according to Piper Jaffray analyst Edward Tenthoff.

3. BIODEL INC (BIOD): FDA decision on VIAject for treatment of diabetes scheduled for October 30. Call open interest at 2,321 contracts vs. put open interest at 684 contracts (Put/Call ratio at 0.29).

4. Alkermes, Inc. (NASDAQ:ALKS): FDA decision on Vivitrol for additional indication as a treatment of opioid dependence scheduled for October 12. Call open interest at 15,997 contracts vs. put open interest at 6,770 contracts (Put/Call ratio at 0.42). The drug is already approved in the U.S. and Russia for the treatment of alcohol dependence.

5. VIVUS INC (NASDAQ:VVUS): FDA decision on Qnexa for the treatment of obesity scheduled for October 28. Call open interest at 87,655 contracts vs. put open interest at 42,128 contracts (Put/Call ratio at 0.48). Sales could peak $1.16 billion by 2015, according to Jefferies & Co. analyst.

Disclosure: No positions