Vertex Shares Slide After Combined Cystic Fibrosis Therapy Disappoints in Preliminary Data

Vertex Shares Slide After Combined Cystic Fibrosis Therapy Disappoints in Preliminary Data

vertexShares of Vertex Pharmaceuticals Inc. fell sharply in the wake of disappointing results of the company’s drug combination of experimental drug VX-661 with FDA-approved Kalydeco. The company stated that its investigational cystic fibrosis drug combination drug did not improve CF patients’ breathing as much as analysts had predicted.

Preliminary results of the company’s clinical study showed that after 4 weeks of the treatment, patients who took VX-661 combined with Kalydeco saw a 4.4 percent increase in the quantity of air they could exhale in 1 second. After 12 weeks of treatment, the improvement decreased to 3 percentage points, Vertex stated.

According to an Evercore ISI survey, investors expected an improvement of almost 6 percentage points after 12 weeks of the combination therapy, leading to a drop in share price to $125.79 — about 4 percent — at the close of the stock exchange in New York on the day data was released. This year, Vertex’s stock has gained 5.9 percent on the strength of Kalydeco’s FDA approval in 2014 and subsequent sales.

Kalydeco is currently FDA-approved as a cystic fibrosis therapy for patients who have two copies of the most common mutation in the CFTR gene, F508del — a mutation that represents 5% of the total CF patient population. While Kalydeco is effective in helping proteins move through the cell membrane, improving the amount of CFTR protein that reaches the cell surface, Vertex believes that VX-661 can help to move the proteins into better formation, increasing the number of CF patients who could take the drug and improving their quality of life.

Vertex explained in a press release that it has begun a late-stage assessment of VX-661, since a mid-stage trial revealed positive results for the experimental therapy. The numbers are being carefully examined by investors and analysts who want to understand exactly how much this combination treatment helped patients in comparison to other Vertex drugs.

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Cystic Fibrosis or mucoviscidosis is a genetic disorder caused by missing or defective proteins that cause a buildup of sticky and thick mucus in the lungs, leading to chronic lung infection and lung damage, and shorter lifespan.

Estimates from the Cystic Fibrosis Foundation say that 70,000 people in the world suffer from this genetic disease.

In other news related to Vertex, The Cystic Fibrosis Foundation recently announced its not-for-profit branch, Cystic Fibrosis Foundation Therapeutics, has signed a strategic transfer of owned Vertex Pharmaceuticals royalty rights to Royalty Pharma for $3.3 billion. CFF Therapeutics owned rights to any Vertex-developed CF treatments, but the foundation has deemed it more beneficial to sell them and allocate the funds to the pursuit of research and new ventures to address this disease.

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