Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of biotech Incyte (NAS: INCY) surged as high as 17% on Wednesday after The U.S. Food and Drug Administration approved its Jakafi pill, a drug designed to treat the rare bone marrow disease myelofibrosis.  

So what: "The availability of Jakafi is a significant medical advancement for people living with myelofibrosis, a debilitating disease," said Incyte CEO Paul Friedman. However, only about 3,500 people in the U.S. are diagnosed with myelofibrosis every year, so today's late-day sell-off -- Incyte shares are now up only 4% -- might be a reflection of that limited market potential. 

Now what: Incyte intends to launch Jakafi with partner Novartis (NYS: NVS) as soon as next week. Of course, when you couple the stock's drubbing over the past few months with today's not-so-explosive reaction, I'd be a little cautious about jumping for joy. After all, with a lofty price-to-sales multiple of 10.5, much of the good news might already be baked into the stock.

Interested in more info on Incyte? Add it to your watchlist.

At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Novartis. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

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