Shares of Endo International (ENDP) are on the rise after the U.S. Food and Drug Administration proposed restricting the ability of companies that produce compounded medications in bulk from using three substances that are active ingredients in FDA-approved drugs. One of the three substances include vasopressin, the active ingredient in Endo International's blood pressure drug Vasostrict, which has been the subject of a lawsuit targeting how the FDA regulates drug compounding.

FDA PROPOSAL: According to a report by the FDA, the agency is "developing a list of bulk drug substances for which there is a clinical need [under section 503B of the Federal Food, Drug, and Cosmetic Act]. Drug products that outsourcing facilities compound using bulk drug substances on the 503B Bulks List qualify for certain exemptions from the Federal Food, Drug, and Cosmetic Act provided certain conditions are met". The FDA identified three bulk drug substances that it has considered and is proposing not to include on the list: bumetanide, nicardipine hydrochloride, and vasopressin. "The bulk drug substances that we are addressing in this notice are components of FDA approved drug products, and we therefore began our evaluation by asking the following questions: Is there a basis to conclude, for each FDA-approved product that includes the nominated bulk drug substance, that an attribute of the FDA-approved drug product makes it medically unsuitable to treat certain patients for a condition that FDA has identified for evaluation, and the drug product proposed to be compounded is intended to address that attribute? Is there a basis to conclude that the drug product proposed to be compounded must be produced from a bulk drug substance rather than from an FDA-approved drug product? [...] We did not answer 'yes' to both of the threshold questions for bumetanide, nicardipine hydrochloride, or vasopressin, and we did not consider the four additional factors in our proposal not to include bumetanide, nicardipine hydrochloride, or vasopressin on the 503B Bilks List", the FDA notice read. Additional bulk drug substances nominated by the public for inclusion on this list are currently under consideration and will be the subject of future notices, the FDA added.

PRICE ACTION: In afternoon trading, shares of Endo International have gained over 5% to $16.34.