Major biopharmaceutical stocks faced significant declines on Tuesday following the revelation that Novartis’s late-stage trial for a cholesterol-lowering drug failed to demonstrate clinical benefit. The setback underscores the persistent risks inherent in drug development and has sparked broader uncertainty regarding therapies targeting lipoprotein(a), or Lp(a).
Novartis announced on Friday that its Phase 3 study of pelacarsen did not reduce the incidence of serious cardiovascular events, such as heart attacks and strokes. While the drug successfully lowered Lp(a)—a hereditary particle linked to increased heart disease risk—the absence of improved patient outcomes challenges the assumption that reducing this marker alone is sufficient to prevent fatal events.
Market reactions were immediate and severe. Novartis shares dropped 10.2% on the Swiss exchange, while Ionis Pharmaceuticals, the biotech firm from which Novartis licensed pelacarsen for a $60 million upfront payment in 2023, saw its stock fall approximately 7.2% at market open.
The failure cast a shadow over the entire sector, with competitors also experiencing losses. Amgen, which is currently conducting its own Phase 3 trial for an Lp(a) therapy, saw its shares decline by 8.2%. Eli Lilly, another major player with two Lp(a) drugs in Phase 3 development, lost about 2.7% of its value. Analysts noted that Amgen’s drop contributed to dragging down the Dow Jones Industrial Average on Tuesday morning.
Financial experts remain divided on the future of Lp(a) as a therapeutic target. Jefferies analyst Akash Tewari acknowledged the industry’s historically mixed results with the target, while BMO Capital Markets analyst David Lebowitz suggested that different outcomes may still be achievable with assets that provide deeper and more durable Lp(a) reduction.
The ripple effects extended to other companies in the space. NewAmsterdam, which is developing an LDL-C-lowering therapy where Lp(a) reduction is a secondary benefit, saw its stock fall 6.7%. Additionally, Sarepta Therapeutics tumbled 11.5% after Novartis disclosed a separate Phase 3 failure for an experimental myotonic dystrophy treatment, a program resulting from Novartis’s $12 billion acquisition of Avidity Biosciences.
According to the Family Heart Foundation, roughly one in five Americans has high Lp(a), a condition that is largely resistant to traditional interventions like statins and diet. This has driven intense competition among drugmakers to develop novel antisense and siRNA therapies capable of improving outcomes for these patients.
That 10% drop for Novartis is brutal. Makes you wonder if the entire Lp(a) sector is overvalued on hope rather than hard data.
Just because it lowers a marker doesn’t mean it helps the patient. Nature is cruel, but science must prove efficacy, not just biology.