Shares of Fate Therapeutics Inc. (NASDAQ: FATE) saw a healthy gain early on Monday following a key U.S. Food and Drug Administration (FDA) approval. Looking at the stock performance in 2016, this company has been crushed, but this approval could very well be the turning point that this company needs.

The company announced that the FDA has granted Fast Track Designation for ProTmune for the reduction of incidence and severity of acute graft-versus-host disease in patients undergoing allogeneic hematopoietic cell transplantation (HCT).

Apart from this, Fate also announced that its multi-center, randomized, controlled Phase 1/2 clinical trial of ProTmune in adult subjects with hematologic malignancies is open for patient enrollment.

For some background on the ProTmune treatment: the cell therapy is produced by modulating a donor-sourced, mobilized peripheral blood graft ex vivo with two small molecules to enhance the biological properties and therapeutic function of the graft’s immune cells.

Ultimately, the Fast Track Designation is designed to facilitate development and expedite review of experimental therapies that address the unmet medical needs of patients with serious conditions.

Chris Storgard, M.D., chief medical officer of Fate Therapeutics, commented:

The Fast Track designation for ProTmune underscores the significant need to address life-threatening immunological conditions which compromise the curative potential of allogeneic hematopoietic cell transplantation. Acute graft-versus-host disease is a leading cause of morbidity and mortality in allogeneic HCT recipients. There is no approved preventive therapy, and current treatments suppress immune function and place high-risk immunocompromised patients at even greater risk for severe infections. We look forward to continuing to work with the FDA to rapidly advance our novel immunotherapy through the clinical development and regulatory processes, with the aim of bringing a transformative therapy to patients in an expedited time frame.

So far in 2016, Fate has underperformed the broad markets, with the stock down 50%, as of Friday’s close.

Shares of Fate ended Friday down 4.6% for the day at $1.68, with a consensus analyst price target of $5.80 and a 52-week trading range of $1.46 to $8.37. Following the announcement, the stock was up over 26% at $2.12 in early trading indications Monday.

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