Shares of Swiss pharmaceutical company Novartis declined sharply following the announcement that its investigational drug for myotonic dystrophy type 1 (DM1), del-osiran, failed to meet the primary endpoint in a late-stage clinical trial. The company reported that the treatment did not demonstrate a statistically significant improvement compared to placebo, measured by the time it took patients to open their hand after gripping.
The trial setback comes amid a series of recent challenges for Novartis. Earlier in the week, the company disclosed that pelacarsen, an experimental cardiovascular drug aimed at reducing severe cardiovascular events, had also failed in a clinical trial. Additionally, Novartis paused eight trials of a novel cell therapy for autoimmune and neurological disorders in late August following the deaths of three patients. Despite these difficulties, the company recently reported positive results from a multiple sclerosis pill.
Del-osiran was considered a key asset following Novartis’s $12 billion acquisition of US biotech firm Avidity Biosciences in February. The drug was among the most advanced candidates acquired through the deal, which was part of a broader effort to strengthen Novartis’s pipeline amid looming patent expirations on several blockbuster products, including the heart failure drug Entresto. Novartis continues to develop two other experimental antibody oligonucleotide conjugates from the Avidity portfolio, which are designed to deliver RNA therapies to muscle cells.
Novartis’s chief medical officer, Shreeram Aradhye, acknowledged the challenges of developing treatments for complex neuromuscular conditions like DM1 and described setbacks as part of the scientific progress. The company stated it will continue to analyze the full dataset and engage with regulatory authorities to determine the appropriate next steps for the del-osiran program.
Despite the trial failure and recent announcements, Novartis maintained its financial outlook, reiterating guidance for compound annual growth in sales of between 5% and 6% for the 2023-30 period. However, some analysts have noted that doubts about the company’s growth prospects beyond 2030 could resurface due to these clinical setbacks.
Novartis shares closed down approximately 11% following the trial news, retreating to around CHF 111.80 but remaining modestly higher year-to-date. The recent sequence of trial outcomes is seen as a critical moment for Novartis as it seeks to sustain innovation and revenue growth in an increasingly competitive pharmaceutical landscape.