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This last trading week (October 1st through October 5) has been very interesting indeed. Here is a recap of some of the biggest stories, and some implications for the upcoming week:

The highlight of the week, Sarepta Therpaeutics (NASDAQ:SRPT), saw very boring trading until Wednesday morning, when news of its flagship drug Eteplirsen came out and sent shares soaring 200% higher. These phase IIb results gave indication that the drug was able to significantly slow the progress of Duchenne Muscular Dystrophy, which is especially exciting, since there are no cures or effective treatments for the disease. While there is growing talk of a potential FDA approval with just phase IIb trials, SRPT gave back about 24% in the last two trading sessions on profit-taking. Adam Feuerstein cites a $400-500 million market potential in the US, which would make Sarepta fairly undervalued - especially with more slide in the stock price.

Synta Pharmaceuticals (NASDAQ:SNTA) also broke a new 52-week high on phase IIb results for its flagship compound ganetespib (with docetaxel). This compound is showing a lot of promise in non-small cell lung carcinoma, although it seems that the hype over the new results has been factored in already. Overbought conditions imply that profit taking may overwhelm the exhausted bulls, although the longer term trend looks great. Additionally, Arena Pharmaceuticals (NASDAQ:ARNA) still suffers from an underperform rating from Credit Suisse and other analysts.

Also making news in non-small cell lung cancer is the discontinuation of phase III trials for ArQule's (NASDAQ:ARQL) ARQ 197 - also called tivantinib. This was recommended by their data monitoring committee, which crunched the numbers and figured that the drug wasn't going to meet its primary endpoint. Due to the disappointing news ARQL got crunched by 56% on Tuesday. Trading has been very volatile, but not completely directionless. ARQL is moving back up due to some faithful buyers, while we see shorts lightening their positions to capture gains.

Amarin (NASDAQ:AMRN), probably the most watched name in bio-tech besides the giants, has seen interesting activity as well. Trading was tame until we saw a downgrade from Wedbush, which was based on frustration over the NCE status of flagship drug Vascepa. In addition to this, fading speculation over big pharma acquisition/partnership with Amarin seems to be weighing on the stock. Still, based on valuation (and the sheer size of the cardiovascular drug market), the bullish motto is now "stay long, stay strong". The same could be said about ACADIA Pharmaceuticals (NASDAQ:ACAD), which broke a new 52-week high on Friday in anticipation of phase III results for its Parkinson's Disease Psychosis drug pimavanserin that are due in a few weeks. The stock actually suffered from a brief breakdown in late Friday trading, which erased most of Thursday's big rally, but this seems likely to be reversed.

Concluding the recap, we have AEterna Zentaris (NASDAQ:AEZS) which performed its reverse 1:6 stock split on Friday in order to regain compliance with NASDAQ trading stanadards. Investors continue to push the shares lower due to apprehension about future share dilution, which is reflected by the stock's 26% decline this week. AEZS will probably trade on this theme for quite some time.

Source: Weekend Recap: Biotech Madness