Novartis shares plunged 8.8% on Tuesday, making the Swiss drugmaker one of the biggest decliners in European markets after experiencing back-to-back drug trial failures. The latest setback came from del-desiran, an experimental treatment for myotonic dystrophy that failed to meet its primary endpoint in late-stage testing. This follows the previous day's disappointing results from a late-stage trial of pelacarsen, the company's experimental cholesterol-lowering drug that failed to reduce the risk of heart attacks and strokes in patients with high levels of lipoprotein(a). The back-to-back failures have raised significant concerns over Novartis' drug development pipeline and future growth prospects, contributing to broader market volatility.
Wall Street was caught off guard by the trial failures, with Novartis' US-listed stock falling more than 7% shortly after regular trading ended, while partner Ionis Pharmaceuticals stock fell 12% in aftermarket trading. As reported by Reuters, the American Depositary Receipts had risen 16% this year through the close. Shares in Amgen Inc., which is also developing an Lp(a) drug, fell 7% in postmarket trading. In early trading in Zurich, Novartis shares dropped by as much as 3.9%, marking the largest decline in over four months, despite the stock having risen 14% so far this year. At one point, Novartis said the market for Lp(a) drugs could be worth more than $5 billion. Analysts at UBS had projected peak annual sales of about $1.5 billion for Novartis' drug, due to competition, with investors now focused on pelacarsen, anti-inflammatory drug remibrutinib, and gene therapy del-desiran as key drivers of the company's long-term growth.
Lowering Lp(a) was considered a new frontier in battling heart disease, with millions of people having elevated levels of the cholesterol-carrying particle. According to Reuters, the condition is also inherited, meaning it's resistant to changes in diet or exercise. However, it's not been clear whether lowering Lp(a) will lead to a reduction in major cardiovascular events. Citi analyst Geoffrey Meacham said the first dedicated outcomes failure "increases uncertainty across the Lp(a) field" and noted he "would not declare the mechanism dead." The Novartis trial was viewed as a bellwether for the drug industry, where several other companies are trying similar approaches. Other companies including Amgen and Eli Lilly & Co. are testing their own drugs to lower Lp(a), though they're further behind in development. Modern cholesterol drugs, such as high dose statins and weight-loss drugs like GLP-1s are already effective at keeping patients healthy, making it much harder for new, experimental drugs to prove they can offer any extra protection.
The trial was the first late-stage study to test whether the drug can prevent heart attacks and strokes in patients with already well-controlled "bad cholesterol" that is not inherited. As reported by Reuters, the study ran for more than six years and tested over 8,000 patients with high levels of Lp(a). The drug is a subcutaneous injection given once a month that lowers lipoprotein(a) or Lp(a). Consistent with previous studies, pelacarsen lowered levels of the cholesterol-carrying particle lipoprotein(a) or Lp(a) in patients, the companies said. The failure represents a significant setback for the Lp(a) drug development field, as it was considered a potential blockbuster treatment approach. Citi analyst Geoffrey Meacham noted that full trial data are needed to determine whether the miss reflects pelacarsen's mechanism of action, inadequate Lp(a) reduction, trial design, or doubts that lowering Lp(a) reduces heart disease risk. There are currently no approved treatments specifically designed to lower Lp(a), which affects 20% of people worldwide. Novartis licensed the drug from Ionis Pharmaceuticals in 2019.
Analysts at UBS had projected peak annual sales of about $1.5 billion for Novartis' drug, due to competition. According to Reuters, Gissette Reyes-Soffer, an associate professor at the Columbia University Irving Medical Center, cautioned against interpreting the failure as a verdict on the broader field, noting that other studies are testing different drugs and patient populations. "I remain optimistic," Reyes-Soffer said. Full data from the trial will be essential to determine whether the failure is a result of how the drug works, the trial's design, or a true challenge to the Lp(a) hypothesis. There are currently no approved treatments specifically designed to lower Lp(a), which affects 20% of people worldwide. Other experimental Lp(a)-lowering drugs in development include Amgen's olpasiran and Eli Lilly's lepodisiran, both of which are in late-stage development. Novartis plans to present the full results at an upcoming medical meeting.
