CASI Pharmaceuticals Surges 57% on FDA Clearance Breakthrough – Can This Momentum Sustain?

Summary
• CASI shares surged 57.2% to $2.028, breaching intraday high of $2.57
• FDA cleared IND application for CID-103, a CD38 monoclonal antibody targeting kidney transplant rejection
• Turnover spiked 2043% to 62.9 million shares, signaling strong institutional interest

CASI Pharmaceuticals' stock ignited a market frenzy after receiving critical FDA clearance for its Phase 1 clinical trial of CID-103. The 57% intraday rally, fueled by renewed pipeline optimism, has pushed the stock to its highest level since 2023. With the biotech sector facing regulatory headwinds, this development marks a pivotal inflection point for the underperforming name.

FDA Clearance Ignites Surge in CASI Pharmaceuticals
The 57% intraday surge originated from FDA approval of CASI's IND application for CID-103, its anti-CD38 monoclonal antibody targeting antibody-mediated rejection in kidney transplant patients. This regulatory green light enables Phase 1 trials for a therapy addressing an $800 million unmet medical need, with CEO David Cory emphasizing the 'urgent need for resistant AMR treatments.' The clearance validates CASI's pipeline strategy after years of setbacks, with CID-103's unique CD38 epitope binding profile distinguishing it from competitors. Institutional buyers capitalized on the catalyst, with 62.9 million shares traded—equivalent to 2043% of average volume—indicating strong conviction in the development milestone.

Biotech Sector Reacts to Regulatory Momentum
The biotech sector showed mixed performance as CASI's surge contrasted with broader market caution. While Amgen (AMGN) rose 1.69%, reflecting sector strength in late-stage assets, smaller biotechs like Leap Therapeutics (-1.54%) and MediciNova (-5.59%) lagged. CASI's rally highlights the sector's sensitivity to regulatory catalysts, with its 52-week range of $1.09-$7.67 suggesting renewed interest in high-risk, high-reward pipeline plays. The clearance for CID-103 positions CASI as a potential dark horse in the AMR treatment space, where current therapies like Thiotepa face safety limitations.

Options Playbook: Leveraging Volatility in CASI's Breakout
• 200-day MA: $2.72 (below) • RSI: 42.86 (oversold) • MACD: -0.02 (bearish) • Bollinger Bands: $1.17-$1.59

The technical landscape presents a high-risk, high-reward scenario. With RSI at oversold levels and MACD signaling bearish divergence, short-term continuation of the rally is uncertain. However, the 52-week range suggests potential for mean reversion if the stock holds above $1.82. No leveraged ETF data is available, but the sector leader Amgen's 1.69% gain indicates biotech sector resilience.

• CASI20260116C2.5 (Call Option): Strike $2.50, Exp: 2026-01-16, IV 96.78%, Delta 0.487, Gamma 0.315, Turnover $1.75M
• CASI20260116C2.5 (Put Option): Not applicable

The CASI20260116C2.5 call option stands out with a 96.78% implied volatility ratio, indicating strong market expectation of price movement. The delta of 0.487 suggests moderate sensitivity to price changes, while the high gamma (0.315) implies increasing delta as the stock approaches $2.50. With $1.75M turnover, liquidity is adequate for institutional positioning. Projected 5% upside to $2.13 would yield a $0.13/share payoff, representing 52% return on the option's premium. Aggressive bulls should consider this contract into a breakout above $2.10, while conservatives may use $1.82 support as a buy point.

Backtest CASI Pharmaceuticals Stock Performance
The performance of CASI after an intraday surge of 57% shows mixed results in the backtest. While the 3-day win rate is relatively high at 43.04%, the returns over longer periods such as 10 days and 30 days are negative, with a 10-day return of -0.72% and a 30-day return of -1.22%. This suggests that while the ETF may experience short-term gains, it can underperform in the medium to long term following such a significant surge.

CASI's FDA Win: A Catalyst to Watch or a Flash in the Pan?
The FDA clearance for CID-103 provides CASI Pharmaceuticals with a critical near-term catalyst, but sustainability depends on execution in Phase 1 trials. Technical indicators suggest caution, with RSI at oversold levels and MACD bearish divergence. Investors should monitor the $1.82 support level and the $2.50 strike price as key inflection points. With Amgen (AMGN) rising 1.69%, the biotech sector shows resilience, but CASI's high volatility requires strict risk management. Positioning in the CASI20260116C2.5 call option offers leveraged exposure to potential upside, but only for those comfortable with the stock's 52-week range volatility.