Arcutis (ARQT) Surges 3.46% on FDA sNDA Submission for Pediatric Psoriasis Drug

Arcutis (ARQT) surged 3.46% on Monday, marking its fifth consecutive day of gains and a 17.04% rally over five days. The stock hit an intraday high of $17.33, its highest since September 2025, reflecting renewed investor confidence in the biopharma company’s strategic advancements.

The recent momentum follows Arcutis’ submission of a Supplemental New Drug Application (sNDA) to the FDA for ZORYVE (roflumilast) 0.3% cream to treat plaque psoriasis in children as young as two. This regulatory milestone expands ZORYVE’s market potential into a niche pediatric dermatology segment, where current therapies face limitations. Analysts highlight the drug’s first-in-class PDE4 inhibitor mechanism and favorable safety profile as key differentiators, positioning it to capture market share if approved.

Financial performance has also bolstered optimism. Arcutis reported 164.10% year-over-year revenue growth, driven by ZORYVE’s adoption in both adult and pediatric populations. While the company remains unprofitable with a negative EPS of -$0.73 and a forward P/E ratio of 129.98, its revenue acceleration has attracted growth-oriented investors. The stock’s recent valuation surge aligns with its high-growth biotech profile, though risks such as regulatory delays and reimbursement hurdles persist.

Arcutis’ pipeline further strengthens its long-term outlook. Candidates like ARQ-154 for scalp and body psoriasis, ARQ-252 for hand eczema, and ARQ-255 for alopecia areata are in advanced trials, offering potential revenue diversification. Analysts note that successful approvals could reduce reliance on ZORYVE and attract partnerships. However, clinical setbacks or competitive pressures in dermatology could dampen progress.

Technical indicators suggest short-term undervaluation, with an RSI of 26.58 signaling oversold conditions and a bullish MACD crossover. These metrics may attract momentum-driven traders, though long-term success hinges on regulatory outcomes and pipeline execution. With seven buy ratings and no sell ratings from analysts, the stock’s average target price of $21.86 implies a 26.12% upside, reflecting confidence in its dermatology-focused innovation. Investors remain cautious about balancing growth potential against operational risks, but Arcutis’ strategic momentum suggests continued market interest.