Biotech company's stock jumps 40% on promising drug to treat rare lung disease

• Arena's drug Ralienpag met its Phase 2 program goals.
• It is an experimental drug to treat a rare form of lung disease.
• The biotech will now move to a Phase 3 clinical program.

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Shares of Arena Pharmaceuticals surged more than 44 percent Tuesday morning, after the drugmaker announced positive results for a treatment for a rare lung disease.

The experimental drug Ralinepag met its primary Phase 2 program goal to show a meaningful improvement in the conditions of patients with pulmonary arterial hypertension.

Patients who used the drug in the test had greater pulmonary vascular resistance.

"These data give us confidence to move expeditiously toward a Phase 3 clinical program," Arena chief medical officer Preston Klassen said.

The positive results could be a boon for patients suffering from the rare lung disease, where new therapeutic options are needed for the complex course of treatment.