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Ampio Pharmaceuticals' Stock Soars on Eye Drug for Diabetics


The small-cap drug stock is up on scant information about a trial being ended on a positive outcome.

Shares of Ampio Pharmaceuticals (AMPE) jumped 70% Monday after the company said it stopped a mid-stage study of a drug to treat diabetics with a serious eye disorder because of a positive outcome. While the news sounds promising, the company is providing few details.

The study of patients with diabetic macular edema was being conducted at St. Michael Hospital in Toronto. Researchers concluded a benefit from low doses of the company's pill Optina at four and 12 weeks of study, the company said. There was no benefit using a high dose of the drug, the company adds. Ampio says it will release more details later.

The next step for the suburban Denver company is to discuss with the FDA a final trial for Optina, which Ampio says is an improvement over existing injected treatments. Optina itself is not a new drug. Rather, it's a low-dose form of danazol, a synthetic steroid first approved in the 1970s to treat endometriosis.

Optina is one of three lead products the money-losing company is studying. It's also studying Zertane for premature ejaculation and Ampion for chronic inflammation. Ampion is in early stage testing, while Zertane is farthest along in company studies. The company's focus is largely to find new uses for existing drugs. Ampio doesn't discover its own treatments.

If the name Ampio doesn't resonate, it's because the company has had a short life. Ampio was formed when closely held DMI Life Sciences was merged into over-the-counter shell company Chay Enterprises in early 2010. The new company was rebranded Ampio. In May of last year, the stock began trading on the Nasdaq.

Even with Monday's huge jump in price, the stock is still below its high of more $9 a share (recorded last year). The stock is down by more than a third since its Nasdaq listing last year. After rising more than 70% Monday, the shares were up 57% to $4.20 in early afternoon trading Monday.

DMI founder David Bar-Or is Ampio's chief scientific officer. Bar-Or also heads trauma research at two Denver-area hospitals.

Leading Ampio is Michael Macaluso, a serial entrepreneur and DMI investor. Macaluso became chief executive in January after CEO Donald Wingerter took leave.

Earlier this month, Macaluso articulated his company's approach to bringing new drugs to market.

"I believe drug development is flawed," Macaluso told a Cowen & Co. investor conference. "I think it's very expensive, it's costly, there are a lot of delays. The risk-reward ratios are certainly out of the investor's favor."

Twitter: @brettchase

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