Urogen Pharma Ltd. (URGN) shares plunged 5.06% in pre-market trading on Friday, surprising investors given the company's recent string of positive developments. This decline comes on the heels of significant gains, with the stock having surged 21.9% in the previous trading session and an impressive 120% year-to-date.

The biotechnology company recently announced promising preliminary data from its Phase 3 UTOPIA trial, showing a 78% complete response rate for UGN-103 in treating certain bladder cancer patients. Moreover, the FDA has agreed that these results can support a New Drug Application submission, potentially paving the way for future commercialization.

Despite these encouraging developments, the stock's pre-market plummet suggests other factors may be at play. One possible explanation is profit-taking by investors following the recent substantial gains. Additionally, valuation concerns might be contributing to the sell-off. The company's price-to-sales ratio stands at 11.3x, higher than both the peer average of 9.1x and the US Biotechs industry average of 11.2x, potentially indicating that the stock may be overvalued in some investors' eyes.

As Urogen Pharma continues to advance its pipeline and reach new milestones, investors will be closely watching how the company balances its growth prospects with market expectations and valuation metrics. The contrast between today's stock movement and recent positive news underscores the volatility often associated with biotechnology stocks, particularly those approaching key regulatory decisions.