AbbVie's experimental schizophrenia treatment, emraclidine, has failed to meet endpoints in two Phase 2 clinical trials, leading to a significant drop in AbbVie's stock and a surge for Bristol Myers Squibb (BMS). The failure bolsters the market position of BMS's newly approved schizophrenia treatment, Cobenfy (formerly KarXT).
Emraclidine's Phase 2 Disappointment
The trials assessed emraclidine in patients experiencing acute exacerbation of psychotic symptoms associated with schizophrenia. The primary endpoint was the change from baseline in the Positive and Negative Syndrome Scale (PANSS) score after six weeks. Results indicated that emraclidine did not produce a statistically significant improvement in PANSS scores compared to placebo. Specifically, emraclidine outperformed the placebo by only 3 points and 1.2 points across two doses in one study. In the second study, the placebo even outperformed emraclidine at the high dose, while the low dose led to a 2.4-point improvement over the placebo.
Piper Sandler analyst Christopher Raymond noted the unexpected high placebo response as a significant factor in the drug's underperformance. The Phase 2 results also fell short of Phase 1 data, where patients had shown a 20-point improvement from baseline in PANSS scores, compared to the 14.2 to 18.5-point improvements observed in Phase 2.
Market Impact and Analyst Perspectives
The news has positively impacted Bristol Myers Squibb, whose stock jumped 11.2% following the announcement. Leerink Partners analyst David Risinger stated that the failure of emraclidine removes a potential competitor for Cobenfy, which gained FDA approval in September and represents a novel mechanism of action in schizophrenia treatment.
AbbVie's Investment Under Scrutiny
AbbVie's acquisition of Cerevel Therapeutics for $8.7 billion to obtain emraclidine is now under scrutiny. Piper Sandler's Raymond suggested that this "mistake" could negatively impact investor sentiment. AbbVie is still investigating emraclidine for dementia-related psychosis, but analysts are skeptical about its prospects in that area.
Mechanism of Action and Competitive Landscape
Both emraclidine and Cobenfy target muscarinic receptors, which are involved in the parasympathetic nervous system, but they do so through different mechanisms. Cobenfy is the first in its class to be approved, offering a new approach to treating schizophrenia. The failure of emraclidine reinforces Cobenfy's unique position in the market, at least for now.
