Sun Pharma Advanced Research shares tank 20% after psoriasis drug fails Phase 2 trials

Synopsis

Sun Pharma Advanced Research Company (SPARC) psoriasis drug, Vibozilimod (SCD-044), failed to meet primary endpoints in Phase 2 trials for psoriasis and atopic dermatitis. The company has decided to discontinue development of the drug. Separately, a surprise FDA inspection is underway at Sun Pharma’s Halol manufacturing facility.

Shares of Sun Pharma Advanced Research Company (SPARC), a unit of India’s largest drug maker Sun Pharmaceutical Industries, tumbled as much as 20% on Wednesday to Rs 156.50 on the BSE after the company disclosed that its investigational drug SCD-044 failed to meet the main goals in late-stage clinical trials for psoriasis and atopic dermatitis.

In a filing released post-market hours on Tuesday, SPARC said, “SPARC informs that its partner Sun Pharmaceutical Industries Limited (SPIL) announced the top-line results from the Phase 2 clinical trials evaluating Vibozilimod (SCD-044) for the treatment of moderate-to-severe Psoriasis (SOLARES PsO) and Atopic Dermatitis (SOLARES AD)."

"SPIL informed that both SOLARES PsO and SOLARES AD studies did not meet the primary endpoint of 75 per cent improvement in PASI (Psoriasis Area and Severity Index) score (> PASI75) at Week 16 and 75 per cent improvement in EASI (Eczema Area and Severity Index) score (>EASI75) at Week 16, respectively,” the company said.

The company further added, “SPARC and SPIL will evaluate the appropriate next steps for SCD-044.”

SPARC confirmed that, given the failure to meet primary endpoints, the development of the drug, also known as Vibozilimod, is being discontinued, and no further clinical trials are planned. The setback is significant as the drug was seen as a key asset in the company’s speciality pipeline.

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Over the past year, SPARC shares have declined about 3%, underperforming the benchmark Sensex, which has risen roughly 12% during the same period.

Surprise FDA inspection at Halol unit

The Halol unit was last inspected in May 2022 and is currently under an import alert following a warning letter from the regulator.

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About the drug and its target conditions

The failure of the Phase 2 studies now casts uncertainty over SPARC’s speciality drug pipeline, with investors and analysts awaiting further clarity on the company’s next steps.

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