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Novartis shares tanked as much as 10.6 percent in Tuesday trading, putting the Swiss pharmaceutical giant on track for its worst single trading day on record after the company disclosed its third significant drug trial disappointment within seven days. The latest blow came from del-desiran, an experimental therapy for a rare, progressive muscle-wasting condition, and it landed on top of two other setbacks investors were still digesting from just days earlier, turning what had been a genuinely strong year for the stock into a stretch of sudden, sharp losses.
The del-desiran failure centers on the Phase 3 HARBOR trial, which tested the drug against myotonic dystrophy type 1, known as DM1, a progressive neuromuscular disease that currently has no approved treatments. In the 54-week study involving 150 patients, del-desiran failed to demonstrate a statistically significant improvement over placebo on its primary endpoint, a measure called video hand opening time that gauges how well a patient’s hand muscles relax after squeezing, essentially a proxy for the muscle stiffness that defines the condition. Shreeram Aradhye, Novartis’s president of development and chief medical officer, acknowledged the setback directly in a statement Tuesday, noting that developing therapies for a complex disease like DM1 remains genuinely challenging and that setbacks are simply part of scientific progress, a fairly candid framing for a company whose stock was actively cratering as he spoke.
What makes this particular failure sting more than an isolated trial disappointment is where del-desiran came from. Novartis acquired the drug roughly a year ago as part of its approximately $12 billion purchase of Avidity Biosciences, a deal that brought three antibody oligonucleotide conjugate therapies into the company’s neuromuscular pipeline. According to Jefferies analyst Michael Leuchten, who maintained a hold rating on the stock while trimming his price target, del-desiran alone represented roughly one-third of the projected peak sales Novartis had been counting on from the entire Avidity acquisition. Leuchten wrote that the problem here “goes beyond this failed trial,” warning that Novartis’s medium-single-digit percentage growth ambitions beyond 2030 will likely now be seen as unattainable without further mergers and acquisitions, a strategy he described as questionable again given how this latest setback compounds an already difficult week.
That difficult week actually began the day before, when Novartis disclosed that pelacarsen, an experimental cardiovascular drug, had failed to reduce the risk of heart attacks, strokes, and cardiovascular deaths in its own late-stage trial. The Lp(a)HORIZON study enrolled more than 8,000 patients with elevated lipoprotein(a), a cholesterol-transporting molecule linked to cardiovascular disease. Pelacarsen did successfully lower Lp(a) levels in patients’ blood, but that biomarker improvement simply didn’t translate into fewer actual cardiovascular events, the outcome the trial was actually designed to measure. That result carries implications well beyond Novartis alone, since both Amgen and Eli Lilly are developing their own Lp(a)-targeting therapies through different biological mechanisms, and pelacarsen’s failure raises genuine questions about whether reducing Lp(a) levels alone is sufficient to meaningfully protect cardiovascular health, a question no approved therapy has yet definitively answered despite elevated Lp(a) affecting roughly 20 percent of the global population.
Rounding out the trio of setbacks, Novartis had already paused eight clinical trials of an experimental cell therapy called rap-cel less than a week earlier, after three patients participating in those studies died. That pause, covering trials targeting autoimmune and neurological disorders, received comparatively less market attention than the two drug trial failures that followed it, but it contributed meaningfully to the broader narrative building around Novartis’s pipeline reliability heading into this week’s del-desiran announcement.
The cumulative market reaction has been severe. Novartis stock has now lost more than 14 percent over the past five trading sessions alone, and Tuesday’s decline trimmed the company’s year-to-date gain down to roughly 4 percent, a stark reversal that leaves it trailing considerably behind rival Roche Holding’s performance over the same period. Novartis shares were trading around 112.56 Swiss francs following the drop, and at least one major brokerage responded by cutting its price target for the stock to 125 francs from 128 francs after removing del-desiran’s projected sales from its financial model entirely.
Despite the string of disappointments, Novartis has maintained its guidance for sales to grow at a compound annual rate of 5 to 6 percent between 2025 and 2030, though analysts have grown increasingly skeptical that the company can hit that target purely through its existing pipeline given this week’s setbacks. It’s worth noting the picture hasn’t been entirely negative for Novartis recently, with Jefferies specifically flagging positive data from a multiple sclerosis trial last week as a partial offset that should help soften some of the blow for investors weighing the company’s broader pipeline health. Still, that single bright spot has done little to stem this week’s selling pressure, given how directly the del-desiran and pelacarsen failures strike at therapies Novartis had been counting on to drive meaningful future revenue growth.
For a company navigating what analysts describe as the largest patent expiration wave in its history, the timing of these back-to-back trial failures is particularly unwelcome. Novartis had leaned heavily on acquisitions like the Avidity Biosciences deal specifically to build out new revenue sources capable of offsetting revenue lost as older, established drugs lose patent protection and face generic competition. With del-desiran now failing to deliver on a substantial share of that acquisition’s promised value, and pelacarsen’s cardiovascular disappointment casting doubt over an entire emerging drug category, Novartis faces a genuinely more difficult path toward its stated growth targets than it did just a week ago, one that several analysts now suggest may require additional dealmaking to fully repair.
Further detail on the company’s clinical trial results is available through Novartis’s official investor relations page. For more coverage of pharmaceutical industry earnings and drug development news, visit Business Tech.
