Novartis shares rise as analysts see multibillion-dollar MS drug opportunity

Novartis paused CAR-T trial after three deaths, UBS noted

Novartis shares rose as analysts at UBS and J.P. Morgan called late-stage trial results for the Swiss drugmaker’s multiple sclerosis drug Rhapsido a potential multibillion-dollar sales opportunity, according to Dow Jones Newswires market talk. UBS separately noted that Novartis paused a clinical trial of its YTB323 CAR-T cell therapy after three patients died.

Analyst notes from UBS, J.P. Morgan, Morgans, and UOB Kay Hian drove notable moves in Novartis, CSL, and Bangkok Chain Hospital during the session.

J.P. Morgan analysts said in a research note that the Rhapsido results reduce risk on a sales opportunity of at least $2 billion to $3 billion in relapsing multiple sclerosis alone. Novartis shares jumped 6.3% on the note.

Consensus forecasts for 2030 Rhapsido sales currently stand at $3.4 billion, mainly from skin conditions, and consensus estimates could see “significant upgrades” after the data, the J.P. Morgan analysts said. Detailed data are still required to assess Rhapsido’s potential relative to Roche’s fenebrutinib and so-called “anti-CD20 therapies,” they added.

UBS analysts, in a separate note, called Rhapsido’s results from the two late-stage studies consistent with a “blue-sky scenario,” with a greater reduction in annualized relapse rates versus Sanofi Aubagio and no liver safety issues. UBS estimated a 50% probability that Rhapsido’s relapsing-MS sales reach $4.5 billion and said the drug might be “at least a best-in-class oral medicine” for the disease. Shares rose 6.2% on the UBS MS-drug note.

In a third note on Novartis, UBS said investors had been cautious about the Swiss drugmaker’s YTB323 therapy, also known as rap-cel, a CAR-T cell therapy that works by removing a patient’s immune cells, engineering them in a lab and reinfusing them. The therapy targets autoimmune and neurological disorders. While YTB323 had been viewed as an important potential program for refractory immunology indications, investors and UBS had been cautious about “the high-risk nature of using CART in immunology,” the analysts said. Novartis shares rose 5.9% on the broader update, lifted by the positive Rhapsido data.

Australia-based pharmaceutical company CSL saw two overhangs on its stock removed by separate U.S. agreements on drug pricing and manufacturing expansion, Morgans analyst Derek Jellinek said in a note. Jellinek said CSL had reinforced its competitive position as a major U.S. manufacturer of plasma-derived therapies. The Medicaid pricing agreement improved visibility on potential U.S. drug-pricing reform exposure, he said, while an onshoring agreement gave greater certainty on tariff exposure. Morgans has a buy rating on CSL with a target price of A$187.71; shares rose 0.9% to A$173.07.

UOB Kay Hian analysts wrote that Bangkok Chain Hospital may benefit from its acquisition of a hospital in Ubon Ratchathani, Thailand, according to management’s update at an analyst meeting. The new Kasemrad International Hospital Ubon Ratchathani is in a strategically strong location, the analysts said, with growth potential partly because there is room to raise treatment prices to match other Kasemrad hospitals. UOB Kay Hian maintained its buy rating on Bangkok Chain Hospital but trimmed its target price to 13.00 baht from 14.00 baht to reflect valuation roll-over. Bangkok Chain Hospital shares were 3.7% higher at 11.10 baht.