Big pharma firm Shire's shares are shining today after it gained regulatory approval for a new dry eye treatment.
Shares jumped by 4.8 per cent at the open, though have fallen back to around 3.1 per cent higher at pixel time.
Shire is planning to make the drug, called Xiidra, available up to 16m people in the US that have been diagnosed with dry eye disease in the third quarter of 2016.
The share price boost adds to the 19 per cent gain Shire's shares have made since the UK vote to quit the European Union – put down to the fall in sterling and pharma industries reputation as a safe haven in times of crisis.
If the treatment picks up regulatory approval in Europe and Japan later this year, it could add global sales of $2.5bn by 2030, according to Citi analysts.
Analysts at Shore Capital said the only competition Shire will face in this market is from Allergan's Restasis.
Cantor Fitzgerald said the approval was "overtly positive" and that the Irish pharmaceutical company's product is superior to Restasis. Eighty per cent of patients stop using Restasis within a year.
Flemming Ornskov, Shire's chief executive, said:
The approval of Xiidra marks a new day in treatment options for patients with dry eye disease, with the only prescription eye drop approved in the US specifically to treat both the signs and symptoms of the condition.
As Shire’s first FDA-approved medicine in ophthalmics, this significant milestone advances our goal of becoming the global leader in this category, where there are unmet patient needs.
We have a robust ophthalmics pipeline, and we look forward to leveraging Xiidra as our entree into the space as we continue to develop additional innovative eye care treatment options.
Xiidra is a prescription eye drop treatment for the signs and symptoms of dry eye disease. It is dosed twice per day, approximately 12 hours apart, in each eye.