GSK Shares Decline After Halting Development of Key Cough Drug

Shares in GSK plc fell on Wednesday after the company announced it would discontinue the development of camlipixant, a promising treatment for refractory chronic cough. The decision follows inconsistent outcomes in two pivotal late-stage clinical trials, creating a significant setback for the company's respiratory drug pipeline.

Conflicting Trial Results

GSK's decision was prompted by conflicting results from its two Phase 3 trials, CALM-1 and CALM-2. While the CALM-1 study successfully met its primary endpoint by showing a statistically significant reduction in cough frequency, the CALM-2 trial failed to replicate this result.

The company stated that this split outcome left the program without a credible regulatory pathway for approval in the United States, European Union, or Japan. The drug was intended to treat adults with refractory chronic cough.

Financial Implications for GSK

The discontinuation represents a notable pipeline write-down for GSK. The company acquired camlipixant through its $2 billion purchase of Bellus Health in 2023, a deal positioned as a key component of its respiratory franchise.

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• The drug was projected to be accretive to GSK's adjusted earnings per share starting in 2027.
• This development setback comes as GSK is also absorbing the financial impact of its recent $10.6 billion all-cash acquisition of Nuvalent, which analysts expect to modestly reduce core earnings per share through 2028.

Market Reaction

GSK stock was trading down approximately 2.6% at 1,906p following the news, after hitting a session low of 1,869p. The decline was exacerbated by a broader risk-off sentiment in global markets, with major indices like the S&P 500 and NASDAQ also trading lower.

While the negative market backdrop contributed to selling pressure, the company-specific news regarding the camlipixant program was the primary driver behind the stock's underperformance.