Gilead Sciences (GILD) suffered its biggest selloff in nine years on Monday amid poor results of the lung cancer trial drug Trodelvy.
GILD shares shed -10.14% to $78.44 apiece on January 22, a day after hitting an 11-month high of $87.29. It recovered 0.15% after-hours to $78.55, but analysts anticipate another -0.67% decline to $77.37 in the coming market session.
The Food and Drug Administration (FDA) already approved the firm’s antibody-drug conjugate (ADC) as a breast and bladder cancer treatment. It directly delivers potent tumor-killing chemicals to cancer cells with minimal damage to surrounding healthy tissue.
However, Gilead believed Trodelvy could also treat metastatic non-small cell lung cancer (NSCLC) alongside chemotherapy docetaxel. However, its phase 3 EVOKE-1 trial showed that it didn’t significantly extend the patients’ lives compared to chemotherapy alone.
With the company failing to boost the effects of other cancer treatments, Gilead needs to consider other potential applications. The Foster City-based firm said it will work with regulators to identify if certain lung cancer patients can benefit from the drug.
It also explored cell therapies Yescarta and Tecartus, but Gilead spent most of its oncology resources on Trodelvy studies.
Trodelvy Was Gilead’s Oncology Flagship
The disappointing results of the trial cast doubt on Gilead’s aim to generate a third of its revenue from oncology products by 2030. Trodelvy represented the historically HIV-focused drugmaker’s attempts to diversify its offerings.
Based on the test results, Gilead can only use Trodelvy in the limited breast and bladder cancer market. Moreover, the FDA approval of AstraZeneca (AZN) and Daiichi Sankyo’s Enhertu threatens to phase out Trodelvy as breast cancer medication.
Enhertu has a 50% chance to halt the progression of breast cancer in chemo patients while also lowering the risk of death by 36%. The FDA approved it four months before schedule, citing its impressive results.
Trodelvy’s NSCLC failure provided AstraZeneca’s stock with a 1.24% after-hours boost.
