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Novartis Stock Tumbles After Late-stage Failure of Myotonic Dystrophy Therapy

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Novartis Stock Tumbles After Late-stage Failure of Myotonic Dystrophy Therapy

Novartis shares (NOVN.SW) dropped 10% on Tuesday after the Swiss drugmaker's late-stage trial for delpacibart etedesiran as treatment for myotonic dystrophy type 1 failed, marking its third clinical setback in a week.

The company reported that del-desiran missed its primary endpoint in the phase 3 Harbor study, with the drug candidate failing to demonstrate "statistically significant improvement" in video hand opening time in patients with the progressive neuromuscular disease versus placebo.

On a positive note, del-desiran showed evidence of clinical activity across secondary endpoints and exploratory metrics, while maintaining a safety profile in line with previous studies.

Novartis said it is assessing the full clinical results and plans to consult with regulatory authorities to determine the "most appropriate" development plan for the del-desiran program.

Ahead of the readout, BofA Global Research said in a Monday note that del-desiran's success was essentially a "must-have" to justify Novartis' $12 billion purchase of Avidity Biosciences earlier this year and build on recent momentum from remibrutinib's trial win in multiple sclerosis.

However, the results delivered another blow to Novartis instead. Days earlier, the company was reportedly forced to halt clinical trials for an experimental cell therapy after multiple patient deaths, while its cardiovascular drug pelacarsen also missed its primary endpoint in a late-stage study.

Despite the setbacks, Novartis on Tuesday reiterated its guidance for a 5% to 6% sales compound annual growth rate between full-years 2025 and 2030.

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