Novartis shares plunge after latest clinical-trial setback

Novartis shares fell 9.6% to CHF 113.42 by around 9:15am on Tuesday, September 8, 2026, as investors reacted to the failure of a clinical trial for Del-desiran, an experimental treatment for myotonic dystrophy type 1. The decline came one day after the company disclosed that its heart medicine pelacarsen had also missed its primary endpoint, sending the stock down 3.2%.\n\nThe two results have put immediate pressure on a company that had reached a record share price of CHF 132.68 only one week earlier. Novartis is one of the largest listed companies on the Swiss market, so the sell-off extends beyond the company’s laboratories and boardroom. It affects pension funds, institutional investors and private shareholders who use the pharmaceutical group as a core holding.\n\nDel-desiran was tested in the Harbor study, which involved around 150 patients over 54 weeks. The trial measured whether patients could open their hands more quickly, a clinical measure linked to the muscle stiffness caused by the disease. The drug did not meet that primary endpoint. Novartis said the results showed indications of an effect in other criteria, but that did not prevent the market reaction. Analysts are now reassessing the value and reliability of the company’s recently expanded drug pipeline.

Del-desiran failed on the Harbor study’s primary endpoint after 54 weeks of testing. The trial focused on myotonic dystrophy type 1, a progressive muscle disorder that can cause stiffness and impaired movement. Researchers used the time patients needed to open their hands as the main measure of treatment performance.\n\nThe endpoint gave investors a clear benchmark for whether the treatment was improving a central symptom of the disease. Novartis said the compound showed indications of an effect in other criteria examined during the trial. Those secondary signals may warrant further analysis, but the failure of the main endpoint sharply reduces confidence in the treatment’s regulatory and commercial prospects.\n\nThe result matters because expectations for Del-desiran were high. Before the announcement, Vontobel estimated that the drug could generate peak annual sales of $3 billion, equivalent to CHF 2.43 billion, after accounting for the risk of failure. UBS had placed potential sales at up to $2 billion on a comparable basis. Vontobel has now removed its sales forecast from its valuation model.\n\nClinical trials routinely produce mixed data, particularly in rare and complex diseases. For investors, however, a failed primary endpoint usually demands a reassessment of development timelines, approval prospects and the price paid for the underlying asset.

Analysts are questioning confidence in the drug portfolio Novartis acquired from Avidity Biosciences. Zurich Cantonal Bank said the Del-desiran result had damaged confidence in the entire group of drug candidates obtained through the US biotech takeover. The bank’s assessment reaches beyond one compound and focuses on how investors judge the acquisition as a whole.\n\nVontobel described the result as a significant setback for Novartis’s pipeline. The concern is financial as well as scientific. Large pharmaceutical acquisitions rely on a sequence of future approvals and product launches to justify their purchase prices. When a leading candidate fails, investors may reduce the value assigned to the remaining programmes, even when those programmes have produced positive results.\n\nKeystone-SDA reported that other compounds from the Avidity acquisition have shown positive trial results to date. Those results provide some support for the portfolio, but they have not offset the market’s reaction to Del-desiran and pelacarsen arriving within days of each other.\n\nThe episode also exposes the timing risk built into biotech deals. Novartis takes on research programmes before regulators confirm their benefit and before commercial demand is certain. The company gains access to potential growth, while shareholders absorb the cost of failure. That balance has become central to the market’s assessment of the Avidity transaction.