Argenx stock plummeted Tuesday after the company's drug unexpectedly failed to help patients with a rare blood disorder.
On the stock market today, shares crashed 10.2% to 445.34. Argenx stock undercut both its 50-day moving average and the lower bound of a consolidation with a buy point at 550.76, according to MarketSmith.com.
The company had been hoping its under-the-skin injection — which sells under the brand name Vyvgart Hytrulo — would help patients with chronic or persistent primary immune thrombocytopenia, or ITP. With this blood disorder, patients experience a decrease in the platelets in the blood. This can lead to bruising and bleeding episodes.
Vyvgart Hytrulo had already shown promise for ITP patients in one final-phase study. But it needed this second study to clinch approval in the U.S. and Europe, Leerink Partners analyst Thomas Smith said in a report. Argenx has already filed for approval of Vyvgart Hytrulo in Japan based on the earlier data.
"Overall, while today's news likely comes as a disappointment to investors, we see limited read-through to Vyvgart's potential in additional (uses), and remain positive on multiple value-inflecting catalysts for Argenx expected to read out in the near term," Smith said.
He has an outperform rating on Argenx stock.
Argenx Stock Rocked By Drug Failure
Smith blamed a higher-than-expected placebo response for the drug's failure in this second study. The company was looking for ITP patients who received Vyvgart Hytrulo to sustain high platelet counts for four to six checkups between weeks 19 and 24 of treatment. Bearishly for Argenx stock, just 13.7% of Vyvgart Hytrulo recipients met that bar. In comparison, 16.2% of placebo patients maintained high platelet counts.
"The placebo response was meaningfully higher and the treatment effect significantly lower in the (study called) Advance-SC compared to the Advance-IV study of intravenous (Vyvgart), which achieved its primary endpoint of sustained platelet count response," he said.
Argenx noted the under-the-skin shot looked as safe and tolerable as the intravenous version of the drug, which sells under the name Vyvgart.
Argenx stock hit its lowest point since mid-July early Tuesday. Shares have a strong Relative Strength Rating of 89 out of a best-possible 99. The RS Rating is a measure of a stock's 12-month performance. This puts Argenx shares in the top 11% of all stocks on that metric, according to IBD Digital.
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