Novartis shares slide after cholesterol drug fails trial

Shares of Novartis ↘ 0.53% fell as much as 3.6% on Monday after the Swiss pharmaceutical giant disclosed that its experimental cholesterol drug pelacarsen failed to demonstrate a meaningful reduction in cardiovascular events compared to a placebo in a late-stage clinical trial, dealing a blow to a therapy many analysts had expected to become a multi-billion-dollar product.news.ssbcrack+1

The results, announced after Friday's market close, showed that while pelacarsen effectively lowered levels of lipoprotein(a) — a cholesterol-like particle linked to heart disease — the reduction did not translate into fewer heart attacks, strokes, or other cardiovascular events. The disappointment weighed on Switzerland's benchmark index, which dropped 0.8% on the day, and marked Novartis's largest single-day decline since April.lse+1

Pipeline Pressure Mounts

The setback is particularly consequential for Novartis as it faces an approaching patent cliff, with several blockbuster drugs nearing the end of patent protection and becoming vulnerable to generic competition. Many analysts had projected pelacarsen could generate billions in annual revenue, though investor sentiment had already been cautious ahead of the trial readout.news.ssbcrack

Chief Medical Officer Shreeram Aradhye acknowledged the results fell short of expectations but said they contribute valuable evidence toward understanding the relationship between lowering lipoprotein(a) and cardiovascular risk.news.ssbcrack

The failure raises the stakes for Novartis's remaining pipeline, particularly del-desiran, an experimental muscular dystrophy treatment that came through the company's $12 billion acquisition of Avidity last year.news.ssbcrack

Ripple Effects Across Pharma

The fallout extended beyond Novartis. Ionis Pharmaceuticals ↘ 0.16%, a partner on the pelacarsen project, saw its U.S.-listed shares fall roughly 10% in extended trading on Friday. Amgen ↗ 0.48%, which is developing a rival treatment targeting the same biological pathway, dropped about 5%.news.ssbcrack

In broader European markets, the pan-European STOXX 600 closed nearly flat at 649.9 points, with healthcare stocks among the day's notable losers. Rising oil prices tied to renewed U.S.-Iran tensions and thin trading volumes — with U.S. markets closed for a public holiday — kept activity muted, according to Reuters. Deutsche Bank ↗ 4.14% now expects the European Central Bank to follow an anticipated September rate increase with an additional quarter-point hike in December, as higher crude prices fuel inflation concerns.lse