Cardiome Pharma Corp said its partner Merck & Co returned the global marketing and development rights for both versions of their heart drug, six months after dropping development of the oral version.
"The market has been waiting for some clarity as to where this franchise is going and we thank Merck for providing that clarity," William Hunter, interim CEO of Cardiome, said on a conference call.
Cardiome shares rose 22 percent to 44 Canadian cents on the Toronto Stock Exchange. The stock, which has lost nearly 86 percent of its value this year through Tuesday close, was one of the top percentage gainers on the exchange.
Cardiome's U.S.-listed shares rose as much as 22 percent to 45 cents on the Nasdaq on Wednesday.
The drug, Vernakalant, is an experimental treatment for chronic atrial fibrillation, a heart rhythm disorder that can lead to stroke and heart failure.
Merck in March dropped the development of an oral version of the drug due to regulatory issues and expected development timeline, forcing Cardiome to cut about 85 percent of its workforce.
"We will take a long hard look at what can be done to reinitiate momentum on the intravenous program in the U.S. ... or what the next step should be on the oral program," the company said.
The intravenous version of the drug is not approved in the United States or Canada, Cardiome said in a statement.
Cardiome, which had cash and cash equivalents of $60.7 million at June 30, said it may be beyond its financial capabilities to do that alone.
Vancouver-based Cardiome also develops drugs for the circulatory system.
(Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Sriraj Kalluvila)