Abivax shares sink after key trial results for inflammatory bowel drug

By Gianluca Lo Nostro

June 2 (Reuters) – Abivax shares tumbled on Tuesday after the French biotech reported late-stage data for its experimental inflammatory bowel drug, with investors focusing on ​safety concerns even as the treatment showed strong efficacy.

The ‌shares were down 30% in early Paris trading, leading losses on Europe’s STOXX 600 benchmark index, after a spectacular rally last year that saw the stock rise more than 16-fold.

Obefazimod is an oral drug being developed for ulcerative ‌colitis, ​a chronic disease that causes inflammation ⁠and ulcers in the colon. ⁠In a 44-week maintenance study, 50.8% of patients on the 25 mg dose and 51.3% on the 50 mg dose achieved clinical remission, compared with 10.4% on placebo.

Both doses met ​the trial’s main goal, showing respective placebo-adjusted remission rates of 39.3% and 40.3%, among the strongest reported in a large ulcerative ⁠colitis programme.

However, three patients on the ⁠50 mg dose had one case each of ​prostate cancer, breast cancer and colonic dysplasia. Abivax said in its ​report on the study, published on Monday, that investigators considered ‌the cases unrelated to treatment.

In a note to investors, Jefferies analysts said the cancer cases “broke” its investment thesis, as they may hang over the sentiment regardless of the reason.

“Even if proven to ⁠be not drug-related or very low incidence, we expect an overhang to investor interest, strategic optionality, and commercial uptake,” they wrote.

Truist Securities analysts ⁠also said that safety ‌questions, with causality still up for debate, ⁠were likely to drive share volatility, even though ​the drug’s ‌efficacy was impressive.

Abivax was not immediately available ​for additional comment ⁠on concerns over the cancer cases.

On the other hand, Yale Jen, senior managing director at brokerage Laidlaw & Company, said the selloff could be an overreaction toward any safety concerns, while calling the overall results a “homerun” for the drug’s development.

(Reporting by Gianluca Lo Nostro; Editing ​by Milla Nissi-Prussak)