Kiniksa Pharmaceuticals shares currently hover just below a buy point, making the biotech stock Tuesday's choice for IBD 50 Stocks To Watch.
The Lexington, Mass.-based drugmaker focuses on treatments for rare diseases. Its primary drug Arcalyst treats recurring pericarditis, a heart disease caused by an autoimmune condition. The condition leads to fluid buildup around the heart or changes in electrical impulses that help the heart pump blood into the body. That triggers inflation in the outer wall of the heart repeatedly.
Arcalyst was discovered by Regeneron Pharmaceuticals. The drug got the Food and Drug Administration's approval in 2008 for treating a rare genetic inflammatory disorder called Cryopyrin-Associated Periodic Syndrome.
Kiniksa then licensed the drug in 2017 to evaluate it for treating conditions caused by certain proteins in the body that activate inflammation, resulting in rare diseases including recurring pericarditis. The company holds exclusive worldwide rights to sell Arcalyst and splits its profits from sales and third-party proceeds evenly with Regeneron.
How Arcalyst Works, Where It Stands
Arcalyst is a weekly injection and works by inhibiting proteins that send inflammatory signals between cells. Plans for clinical trials for expanding treatment options to a single monthly injection are underway with a focus on inhibiting signals that cause inflammatory responses in patients.
Arcalyst got a Breakthrough Therapy designation from the FDA for the treatment of recurring pericarditis in 2019 and has held an orphan drug status since 2020. The FDA gives an orphan drug designation for medicines that target rare diseases affecting limited patient populations.
Product revenue from Arcalyst grew to $137.8 million in the first quarter — a 73% increase from the prior year. The company boosted its midpoint product revenue outlook to $598 million from $570 million for 2025. Meanwhile, average treatment time for patients on Arcalyst increased to 30 months from 27 months in the fourth quarter.
Biotech Stock Under Accumulation
Kiniksa stock rocketed 20% after first-quarter results on April 29. The biotech stock then broke out of a cup base with a buy point of 28.15 on May 5. IBD MarketSurge shows that shares traded tightly for three weeks after the breakout in a sign of strong action.
Except for one quarter, sales growth has been steady over the past eight quarters.
Kiniksa stock holds a Relative Strength Rating of 90 from Investor's Business Daily, while its Composite Rating meets the minimum recommended rating of 80.
Its Earnings Per Share Rating lags at 38, though the company reported earnings of 11 cents per share in its most recent quarter ended March 31 after four quarters of losses. Analysts anticipate a continued turnaround to profitability. For 2025, they estimate earnings of 72 cents per share. For 2026, estimates sit at $1.27 a share.
Mutual funds own 79% of outstanding shares of the biotech stock, according to IBD MarketSurge data. Moreover, the Accumulation/Distribution Rating of B shows funds have been buying shares in the last 13 weeks.
Kiniksa Pharmaceuticals resides in IBD's medical-biomed/biotech group. The group ranks 57th among Investor's Business Daily's 197 industry groups, according to IBD Stock Checkup.
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