Terumo, GSK, Zealand, Roche shares fall on analyst notes
Argenx said it would discontinue the late-stage trial of its main drug Vyvgart in Sjogren’s disease, according to research notes from UBS and Bernstein. UBS analysts called the decision “a major negative surprise,” writing that “We believe Argenx’s discontinuation of Sjogren’s study at interim suggests potentially very little efficacy—if any—not just a ‘near miss.’” The study was supposed to be one of the most closely watched updates from Argenx next year, and UBS had modeled peak annual sales for Vyvgart in Sjogren’s at $3.5 billion, the analysts said. The drug had previously generated positive and solid results in a midstage study, and a similar medicine from rival Johnson & Johnson, Imaavy, had also generated positive midstage results, UBS noted. Argenx shares dropped 16% on the news.
Separately, Argenx reported positive midstage results for FB102, a drug candidate it acquired through its Forte Biosciences deal, in celiac disease. Bernstein analysts said the results vindicate the company’s CEO change earlier in the year and reinforce the potential of a medicine being tested for two diseases with “little or no existing nonsystemic drug treatment options.” “A key rationale for the CEO transition was to diversify the organic pipeline with external innovation,” Bernstein wrote.
Bernstein described Sjogren’s as a heterogeneous disease that has become a research-and-development “graveyard” for the industry, adding that the Vyvgart discontinuation should come as little surprise.
Japanese medical equipment maker Terumo is exiting its plasma collection business in a move Jefferies analysts said is likely to drag sales in the near term but strengthen its longer-term earnings. The exit will result in a $610 million charge and the company is cutting fiscal-year earnings guidance, according to the note. Jefferies cut its Terumo revenue forecast for the fiscal year starting in April 2027 but raised operating profit estimates for the period onward, citing management’s expectation that profitability for blood and cell technologies will improve as resources are redirected toward higher-growth, higher-margin apheresis and blood processing franchises. Jefferies cut its target price to ¥2,700 from ¥3,300 and kept its buy rating. Terumo shares were 2.0% lower at ¥2,261.5.
At GSK, J.P. Morgan analysts said CEO Luke Miels views the U.K. drugmaker’s oncology business as underappreciated by the market. Citing a recent call with Miels, the analysts said he reiterated his confidence in delivering GSK’s 2031 sales target of more than £40 billion, “pointing to the breadth and depth of the portfolio, particularly in oncology, which [Miels] sees as underappreciated by consensus.” GSK expects to provide updates on its oncology portfolio at the annual congress of the European Society For Medical Oncology, which Miels expects will improve confidence in the pipeline, according to J.P. Morgan. GSK shares fell 1.8%.
Roche and Zealand Pharma released study results for petrelintide, their jointly developed obesity drug candidate. Jefferies analysts said the results seem unlikely to alter investors’ views on the product. The drug showed a modest effect in reducing blood-sugar levels, and the reported weight-loss rate of 9.2% in obese patients with type 2 diabetes was broadly as expected, according to Jefferies. The analysts said petrelintide’s weight-loss efficacy fell by between 15% and 20% for this group compared with nondiabetic obesity patients, for whom Zealand previously reported a 10.7% reduction. A benign tolerability profile remains the drug’s main point of differentiation, the analysts said. Zealand Pharma shares fell 4%, while Roche traded 1.4% lower.