Novo Nordisk's Hypertension Drug Study Fails to Meet Goal

Novo Nordisk NVO lost 2.2% on Jun 26 after the company announced the failure of a late-stage study evaluating ocedurenone to treat patients with uncontrolled hypertension and advanced chronic kidney disease (CKD). Consequently, the company said that it will recognize an impairment loss of around DKK 5.7 billion related to the intangible assets in the second quarter of 2024.

Such recognition is expected to negatively impact operating profit growth by around 6 percentage points at the constant exchange rate (CER) in 2024. This adjustment revises the previously stated operating profit outlook of 22% to 30% growth at CER, as communicated in their financial report for the first quarter of 2024.

Novo Nordisk is slated to announce its financial results for the first six months of 2024 and update its financial outlook for 2024 on Aug 7, 2024.

Based on interim analysis, an independent data monitoring determined that the study did not meet its primary endpoint of reducing systolic blood pressure from baseline. This conclusion triggered Novo Nordisk's decision to halt the CLARION-CKD study.

Year to date, shares of NVO have jumped 38.9% compared with the industry's 23.1% growth.

Image Source: Zacks Investment Research

The investigational candidate, ocedurenone, is a novel third-generation non-steroidal mineralocorticoid receptor antagonist known for its distinct pharmacokinetic profile, featuring a prolonged half-life and strong affinity for the mineralocorticoid receptor.

Novo Nordisk acquired ocedurenone from KBP Biosciences in 2023. The phase III CLARION-CKD study, conducted by KBP Biosciences, aimed to assess ocedurenone's efficacy inmore than 600 enrolled patients with uncontrolled hypertension and advanced CKD, a condition for which effective treatments are critically needed. The study included a prespecified interim analysis after 12 weeks of treatment for all patients.

The decision to stop the trial underscores the challenges in developing effective therapies for complex conditions like advanced CKD and uncontrolled hypertension. The failure of ocedurenone brought into question the viability of the KBP Biosciences deal.

Zacks Rank and Stocks to Consider

Novo Nordisk currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the drug/biotech industry are ALX Oncology Holdings ALXO, Annovis Bio ANVS and Compugen CGEN, each carrying a Zacks Rank #2 (Buy) at present.

In the past 30 days, the Zacks Consensus Estimate for ALX Oncology's 2024 loss per share has remained constant at $2.89. During the same period, the consensus estimate for 2025 loss per share has remained constant at $2.73. Year to date, shares of ALXO have plunged 60.5%.

ALX Oncology beat estimates in two of the trailing four quarters and missed twice, delivering an average negative surprise of 8.83%.

In the past 30 days, the Zacks Consensus Estimate for Annovis' 2024 loss per share has remained constant at $2.46. During the same period, the consensus estimate for 2025 loss per share has remained constant at $1.95. Year to date, shares of ANVS have plunged 69.4%.

ANVS beat estimates in three of the trailing four quarters and missed once, delivering an average negative surprise of 1.39%.

In the past 30 days, the Zacks Consensus Estimate for Compugen's 2024 earnings per share has remained constant at 5 cents. The consensus estimate for 2025 loss per share is currently pegged at 11 cents. Year to date, shares of CGEN have lost 11.6%.

CGEN's earnings beat estimates in three of the trailing four quarters and missed once, delivering an average surprise of 5.79%.

To read this article on Zacks.com click here.