The court has remanded the case back to the FDA, where Vanda expects the agency will either approve the drug application or the company will receive a hearing.
Vanda Pharmaceuticals Inc. (VNDA) shares surged 9% on Monday after the company said that a Federal Appeals Court overturned the U.S. Food and Drug Administration’s order denying approval to its drug Hetlioz in the treatment of jet lag disorder.
Vanda had submitted its application to the FDA seeking approval for Hetlioz to treat jet lag disorder in October 2018. A federal district court ordered the FDA to resolve the application or commence a hearing with respect to the application after the agency delayed it. However, instead of holding a hearing, the agency issued an order refusing to approve the application, and Vanda subsequently filed a petition for review with the U.S. Court of Appeals for the D.C. Circuit.
The appeals court set aside the FDA’s action and stated that the agency’s “treatment of Vanda’s evidence is cursory,” the company said on Monday. The court has remanded the case back to the FDA, where Vanda expects the FDA will either approve the drug application or the company will receive a hearing.
On Stocktwits, retail sentiment around Vanda jumped from ‘bearish’ to ‘bullish’ over the past 24 hours, while message volume stayed at ‘low’ levels.
A bullish Stocktwits user expects the stock to hit over $5.
Another opined that the legal turnaround is a “strongly bullish development” for Vanda.
Hetlioz is a prescription medicine approved to treat people with Non-24-Hour Sleep-Wake Disorder and to treat nighttime sleep disturbances in Smith-Magenis Syndrome (SMS).
In the second quarter of 2025, Hetlioz’s net sales were $16.2 million, accounting for nearly 31% of Vanda’s overall total revenues. VNDA stock is down by about 11% over the past 12 months.
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