Pharmaceutical giant AbbVie witnessed a devastating blow to its market value today as shares plummeted following disappointing clinical trial results for its experimental schizophrenia treatment, Emraclidine.
The Chicago-based pharmaceutical company reported that Emraclidine failed to demonstrate a statistically significant reduction in psychotic symptoms compared to placebo groups during a six-week phase-two trial involving 752 schizophrenia patients. The news triggered a dramatic 12 per cent drop in AbbVie’s share price, erasing more than £40 billion from its market capitalisation, which fell below £310 billion.
The trial failure represents a significant setback for AbbVie, which acquired Cerevel Therapeutics for £8.7 billion last year primarily to obtain Emraclidine. The acquisition was intended to position AbbVie as a competitor to Bristol Myers Squibb (BMS), whose similar schizophrenia drug recently received FDA approval.
The market response proved particularly favourable for BMS, whose shares surged by 11 per cent as investors recognised the enhanced market opportunity for their newly approved schizophrenia drug, Cobenfy. The development is especially significant given that approximately 2.8 million US adults suffer from schizophrenia, a condition characterised by psychotic episodes and social withdrawal.
Roopal Thakkar, AbbVie’s chief scientific officer, expressed disappointment with the results but affirmed the company’s commitment to analysing the data and determining future steps. Industry analysts at BMO Capital Markets described the outcome as “difficult” for AbbVie, though some suggest the market’s reaction may be excessive.
The setback raises questions about AbbVie’s growth strategy, particularly as the company faces no significant patent expirations until September 2029. Investors are likely to scrutinise the company’s pipeline more closely as it seeks to identify new sources of revenue growth in an increasingly competitive pharmaceutical landscape.
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