Rigel Pharmaceuticals Inc.'s oral syk kinase inhibitor passed its rheumatoid arthritis Phase II test with flying colors, and Wall Street showed its love, sending shares up 224 percent Thursday.

The drug, R788 (tamatinib fosdium), when dosed at 100mg and 150mg orally twice daily achieved higher American College of Rheumatology (ACR) criteria specified response rates than the placebo group, with the onset of pain relief in both dose groups occurring as early as one week after the start of therapy.

"We believe that the significant ACR scores and good tolerability , and the further benefit of oral delivery may make R788 a favorable alternative to the currently marketed biological agents," the company said.

The primary efficacy endpoint in the study was the percent of patients who were "ACR 20" responders at the end of week 12, meaning showing a 20 percent improvement using ACR criteria. The ACR measurement factors include physician and patient global assessment of disease activity, patient reported pain score, and any change in C-reactive protein in the patients' blood.

The data showed that in the 50mg group only 32 percent of participants met the ACR 20 criteria, compared to 38 percent for placebo group. But in the 100mg group 65 percent achieved a 20 percent improvement, and for the 150mg group it reached 72 percent.

The two higher doses of the compound also showed efficacy achieving ACR 50 and ACR 70 levels. At the 100mg dosage, 49 percent achieved ACR 50, and 33 percent reached ACR 70. In the 150mg group, 57 percent reached ACR 50 and 40 percent reached ACR 70.

"This study establishes with very little uncertainty that this drug, at 100mg twice a day or more, is highly effective in treatment of RA in terms of clinical science and symptoms," Elliott Grossbard, senior vice president of medical development for the South San Francisco company, said in a conference call. "We haven't investigated the question of bone erosion and joint damage, but we will in an upcoming study."

The trial was a multi-center, randomized, double blind, placebo controlled, ascending dose study with 189 patients in three approximately equal size cohorts. Within each group patients were assigned on a 3:1 basis to R788 or placebo. The trial was conducted over a 12-week period in patients with RA for at least 12 months. The patients all had active disease despite receiving adequate stable doses of methotrexate over the preceding six months. All received their same stable dose of methotrexate throughout the trial period and extension.

The most common adverse events were neutropenia, especially at the higher doses, mild elevations of liver function tests, and gastrointestinal side effects. Dosage reductions were done for those experiencing adverse effects by cutting to one-half the assigned dose (taking the drug just once per day) and 19 out of 21 patients who had their dose reduced successfully completed the clinical trial with minimal safety issues, the company said.

Michael Weinblatt, from Brigham and Women's Hospital, and principal investigator for the study, said it was "very exciting" to see a dose dependent response because that provides guidance going forward with future studies. He also noted that it was good to see such a result from an RA oral molecule, a therapeutic approach he said has suffered more disappointments that successes.

On the news shares of Rigel (NASDAQ:RIGL) rose $17.95, or 224 percent, to close at $25.95.