Novartis and Amgen Slump as Clinical Trial Disappointments Mount

Novartis shares plummeted on Tuesday after the company revealed disappointing results from a clinical trial. The experimental drug, del-desiran, failed to improve a key indicator for patients with myotonic dystrophy, a muscle loss disease.

This news sent shockwaves through the market, causing Novartis' stock price to drop 13%. The decline has nearly brought their shares back to where they started the year. Just days earlier, Novartis announced that another one of its drugs failed to meet expectations, this time in reducing the risk of cardiovascular events such as heart attacks and strokes.

Amgen, which is working on a similar cholesterol-targeting drug, saw its shares drop 9%. As Amgen holds the fourth-largest weight in the Dow Jones Industrial Average, its decline has put pressure on the index. Novartis' chief medical officer, Shreeram Aradhye, stated that the company will discuss the trial data with regulators and is committed to identifying the most appropriate development path for the del-desiran program.

Despite these setbacks, Novartis remains confident in its sales projections. The company expects a compound annual growth rate of 5% to 6% through 2030.