Shares in Salix Pharmaceuticals rose more than 3 percent Wednesday on news that the FDA had approved its new drug for the treatment of AIDS-related diarrhea.

The FDA had delayed approval of the drug known under the trade name Fulyzag and previously known as crofelemer.

The drug is intended to treat HIV sufferers who are receiving anti-retroviral therapy, or ART.

Salix (Nasdaq: SLXP) believes the drug will help AIDS patients stick to therapy since they now have a treatment for diarrhea.

“The FDA approval of Fulyza is a significant step forward in addressing the unmet medical need of people with HIV/AIDS on ART who experience non-infectious diarrhea, which often can lead to reduced treatment compliance,” said Carolyn Logan, chief executive officer of Salix.

Clinical trials also showed the drug does not affect the efficacy of HIV medications.

“Since the introduction of antiretroviral therapy, people with HIV are living longer and thus medication compliance and tolerability as well as quality of life issues are increasingly important components of their overall health outlook,” Logan added. “Diarrhea negatively affects quality of life and is a common reason for discontinuing or switching ART regimen. Salix’s expertise in gastrointestinal medicine should position the Company to deliver this much-needed treatment to HIV patients.”

Salix plans to make the drug available early this year. 

The Raleigh-based company says it is eligible to receive market exclusivity for five years.

Crofeleme was scheduled for an FDA approval decision in October. It was the second approval delay for crofelemer. The FDA had originally scheduled the compound for a June 5 decision. But in May, the agency notified Salix that regulators needed more time to review the drug application. The FDA at that time did not require any additional studies.

Diarrhea is common in AIDS patients on antiretroviral therapy. Salix says an estimated 50 percent of the 1 million people in the United States living with HIV/AIDS are on antiretroviral therapy. Of those, 30 percent experience diarrhea to some degree. The FDA recognized the unmet medical need and granted crofelemer priority review and fast track status.

Salix said the latest delay had been primarily about the production and control of crofelemer’s active pharmaceutical ingredient, which is the first botanical product to be reviewed by the FDA for oral use. Crofelemer is is derived from the Croton lechleri tree, a tree more commonly known as the “Dragon’s blood tree.” It is found in the rain forests of South America.

Crofelemer was initially discovered and developed by San Francisico, California company Napo Pharmaceuticals. Salix licensed crofelemer from Napo in 2008 and took the compound through phase 3 clinical trials. But soon after the completion of the studies and the release of the the trial results, the relationship between the drug partners became strained and eventually, litigious.

Napo last year sued Salix, claiming Salix breached the contract by failing to file a new drug application in a timely fashion, even though it had positive phase III clinical trial data in hand for months. Napo then terminated the contract last November, on the basis of the alleged contract breach. In response, Salix has repeatedly said Napo’s case and its claims are groundless and without merit.

Salix shares traded at $41.87, up $1.40, in late-morning trading, up 3.46 percent.