Amgen Stock Slides After Novartis Trial Failure, BMO Downgrade

Amgen Inc. (AMGN) shares fell sharply in pre-market trading after a high-profile clinical trial failure from competitor Novartis AG (NVS) raised concerns about an entire class of cholesterol-lowering drugs, leading to an analyst downgrade.

Novartis Trial Casts Shadow on Drug Class

The sell-off was triggered by a September 4 announcement from Novartis that its drug, pelacarsen, failed a pivotal Phase III study. The therapy was designed to lower levels of Lipoprotein(a), or Lp(a), a lipid particle associated with an increased risk of heart disease.

While the drug successfully reduced Lp(a) levels in patients, it did not demonstrate a statistically significant reduction in the risk of cardiovascular death, heart attack, or stroke compared to a placebo, the company reported. This outcome has direct implications for Amgen, which is developing its own Lp(a)-targeting therapy, olpasiran. The drug, an siRNA therapeutic, is currently in a Phase III outcomes study named OCEAN(a)-Outcomes.

BMO Downgrade Cites Valuation

Adding to the pressure, BMO Capital downgraded Amgen's stock to "Market Perform" from "Outperform," while maintaining its $450 price target. The firm cited the stock's strong performance, noting a year-to-date gain of approximately 34% that has significantly outpaced both the S&P 500 and the broader pharmaceutical sector.

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In its note, BMO stated that optimistic expectations for commercial execution are now largely reflected in the stock's valuation. The firm also pointed to patent expiration risks as a factor requiring further assessment before adopting a more positive stance.

Market Reaction and Outlook

The combination of negative catalysts pushed Amgen's shares down 4.7% to $416.88 in pre-market trading. The news from Novartis has weakened, but not completely invalidated, the scientific rationale for targeting Lp(a) to improve cardiovascular outcomes, according to market analysts.

However, the failure challenges the simple assumption that lowering Lp(a) levels will translate directly to commercial success. The next major catalyst for Amgen will be the results from its own OCEAN(a)-Outcomes trial, which investors will now scrutinize to see if olpasiran can succeed where its competitor's drug did not. A broader market decline on the day also contributed to the selling pressure.