The cancellation of a study for Asundexian, the great hope in its drug development, caused the share price of the pharmaceutical and agrochemical group Bayer to fall sharply at the beginning of the week. At the lowest level in the morning, the quotation was down 19 percent at 33.72 euros, its lowest level since March 2009. This is the biggest price drop in at least 32 years. About three times as many shares changed hands within the first 45 minutes of trading as on an average day. The stock market value shrank by around 7.6 billion euros.
An additional burden was Bayer's conviction to pay more than $1.5 billion in another glyphosate lawsuit, according to plaintiffs' lawyers. However, the sums in the USA are often still significantly reduced. On the one hand, potential sources of income are disappearing, on the other hand, there are new potential costs. This combination is also likely to be clearly felt by the share price in the coming weeks, it said.
Bayer completed a Phase III study of Asundexian compared to apixaban from Bristol-Myers-Squibb and Pfizer in patients with atrial fibrillation and stroke risk. This decision is based on the recommendation of the independent Data Monitoring Committee (IDMC) as part of the ongoing study monitoring. Asundexian was touted as the successor to the successful drug Xarelto. Asundexian's efficacy has been shown to be inferior compared to standard treatment, it added. According to earlier information, the anticoagulant was expected to generate peak annual revenues of more than 5 billion euros in the long term.
After the Asundexian failure, analyst Emily Field of the British bank Barclays initially sees immense difficulties for the Leverkusen-based company's pharmaceutical business. A lower valuation would be appropriate, given the uncertainty for the future path after patent expirations for the important drugs Xarelto and Eylea - now without Asundexian.
For analyst Charlie Bentley of the analysis firm Jefferies, the termination of the study with the anticoagulant is also a bitter setback for the development pipeline of the Leverkusen-based group. This would make the challenges for the new CEO Bill Anderson even greater. The pipeline is weak and investment is needed, while debt is high. On top of that, the group continues to be plagued by legal disputes.
"The verdict will not stand in this way, we will definitely appeal against it," Bayer said on Sunday in response to an inquiry. The amount of punitive damages alone violates the U.S. Constitution. The company has won nine of the last 13 court cases and settled the majority of the lawsuits. Bayer remains convinced of the safety of glyphosate.
In 2018, Bayer brought the problems surrounding the glyphosate-containing weed killer Roundup in-house with the Monsanto takeover worth more than 60 billion dollars. In the same year, a first verdict against the Leverkusen club followed, which set in motion a wave of lawsuits in the USA. In 2020, Bayer had set aside billions of euros in provisions to settle the majority of the lawsuits - without admitting liability. Bayer's recent court defeats could signal that the Leverkusen-based company could also need a large part or all of the glyphosate provisions, according to a recent analysis by the bank Morgan Stanley.