What happened Shares of Arena Pharmaceuticals (NASDAQ: ARNA) are up 13% at 2:13 p.m. EDT because its rival, Bristol Myers Squibb (NYSE: BMY), reported positive data on Zeposia in patients with ulcerative colitis. Zeposia targets the sphingosine-1-phosphate (S1P) receptor, just like Arena's etrasimod. So what Typically, good data from a rival drugmaker would send shares down, not up, but ulcerative colitis is a common enough disease -- around a million Americans have it -- that there's enough room in the marketplace for more than one drug. There's also some evidence that etrasimod might be more effective than Zeposia, although the drugs haven't been compared in a head-to-head study. Image source: Getty Images. Bristol Myers Squibb's results are also the first evidence that S1P drugs can help patients with ulcerative colitis. Zeposia is already approved by the Food and Drug Administration to treat multiple sclerosis, but the new data increases the potential for the class of drugs substantially. In fact, the data was solid enough to make some think that Zeposia -- and hopefully Arena's etrasimod too -- can compete with the Janus kinase inhibitors, such as Pfizer's (NYSE: PFE) Xeljanz, which has a black box safety warning on its label. Now what It's back to waiting for Arena Pharmaceuticals' investors. The biotech is currently testing etrasimod in a phase 3 clinical trial for ulcerative colitis. The study will test the treatment over the course of a year and hasn't fully enrolled yet, so it'll be at least a year before investors get to see whether etrasimod can actually compete with Zeposia. 10 stocks we like better than Arena PharmaceuticalsWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Arena Pharmaceuticals wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of April 16, 2020 Brian Orelli has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Bristol Myers Squibb. The Motley Fool has a disclosure policy.Source