Novartis Shares Fall After Cholesterol Drug Study Failure Raises Pipeline Stakes
Impact of Pelacarsen Study Failure on Novartis and the Pharmaceutical Industry
Market Reaction and Study Details
LONDON, Sept 7 (Reuters) - Shares of Novartis fell 3.3% on Monday morning after its cholesterol drug failed in a closely watched study, casting doubt on the therapeutic approach and raising the stakes for the Swiss drugmaker's upcoming data for a gene therapy.
Late on Friday, Novartis said its drug pelacarsen did not cut heart attack and stroke risk in a large, late-stage study of patients with high Lp(a), an inherited, cholesterol-related risk factor with no approved targeted treatments.
Analysts had forecast peak annual sales between $3 billion and $6 billion if the drug proved successful.
Implications for Competitors and Industry
The failure also raises the bar for rival Lp(a)-lowering drugs from Amgen and Eli Lilly, both running late-stage trials for their experimental drugs.
The data "marks a meaningful setback for dedicated Lp(a)-lowering therapies," BMO Capital Markets analyst Evan Seigerman wrote in a note, adding that lowering the protein may offer only a modest heart benefit once other risk factors like cholesterol are already under control.
Pressure on Novartis' Pipeline and Future Prospects
It also increases the pressure on data from an experimental muscular dystrophy drug del-desiran, expected in the fourth quarter. Barclays analysts said success in that trial "is needed to justify" the $12 billion price Novartis paid for its deal to acquire the drug.
Data from another study of Novartis' anti-inflammatory drug remibrutinib in patients with a skin condition called hidradenitis suppurativa is also expected this year. The drug succeeded in a trial of multiple sclerosis patients last week.
Analyst Perspectives and Market Outlook
Jefferies analysts said the multiple sclerosis drug's recent success "should make the conclusion of the pelacarsen study more palatable" for investors.
As of Friday's market close, Novartis shares have gained around a fifth in value so far this year, buoyed by optimism over its pipeline even as it navigates a wave of patent expirations for older drugs.
(Reporting by Bhanvi Satija; Editing by Joe Bavier and Louise Heavens)
