AbbVie Inc (ABBV) experienced a sharp decline in its stock price on Monday following the disappointing results of two Phase 2 trials investigating emraclidine as a potential treatment for schizophrenia. These trials, which explored emraclidine as a once-daily, oral monotherapy, failed to achieve their primary endpoint. This endpoint aimed to demonstrate a statistically significant improvement in the change from baseline in the Positive and Negative Syndrome Scale (PANSS) total score, compared to the placebo group, after six weeks of treatment. The PANSS is a widely recognized scale used for measuring the severity of symptoms associated with schizophrenia.
Wall Street had anticipated positive results from both of AbbVie’s studies, though some analysts expected the details to be mixed. While the disappointing outcome is a setback, Cantor Fitzgerald remains optimistic about AbbVie’s stock, highlighting the undervaluation of the company’s robust pipeline. The firm continues to maintain an Overweight rating with a price target of $240 for ABBV stock.
The negative results of AbbVie’s trials have implications for the broader schizophrenia drug market. Notably, these findings raise questions about the effectiveness of selective muscarinic targeting for treating schizophrenia and other conditions. The data suggests potential differences between positive allosteric modulators like emraclidine and direct agonists like Cobenfy, an approved schizophrenia drug developed by Bristol Myers Squibb & Co (BMY). While AbbVie’s setback presents an opportunity for Cobenfy, it also raises questions about the future of emraclidine as a potential schizophrenia treatment.
Despite this setback, AbbVie’s recent acquisition of Cerevel continues to hold significant promise. Other treatments in development, such as Darigabat (for epilepsy and anxiety) and Tavapadon (for Parkinson’s), are progressing well. Top-line results from the TEMPO-2 Phase 3 flexible-dose monotherapy trial of Tavapadon in Parkinson’s Disease are expected by the end of 2024, while results from the long-term safety study, TEMPO-4, are expected in 2025.
The impact of the failed trials is evident in ABBV’s stock price, which dropped by 11.7% to $176.16 at the close of trading on Monday. While the immediate future of emraclidine remains uncertain, AbbVie’s ongoing efforts in other areas of drug development offer potential for future growth and success.
