Merck KGaA fell the most in three months after the German drugmaker said it would no longer seek approval for the multiple sclerosis pill cladribine as regulators requested new clinical trials.
Merck declined 2.8 percent, or 2.11 euros, to 73 euros in Frankfurt trading.
Merck had already lost the race to get the first tablet against multiple sclerosis on the market after Novartis AG’s Gilenya was approved last year in the U.S. Merck’s decision will result in an exceptional charge of 20 million euros ($28.8 million) in the second quarter, the Darmstadt-based company said in an e-mailed statement today.
“There’s no resurrection here,” Jack Scannell, an analyst with Sanford C. Bernstein Ltd. in London, said in an interview. “The resurrection wouldn’t have been terribly valuable, but there was resurrection potential even with a delay.” Scannell rates Merck’s shares “market perform.”
“At best we thought this drug could be salvaged in 2013 and 2014 and by then the impact on revenue would be minimal,” he said. “The MS market would be much more competitive.”
Merck said it will continue ongoing cladribine trials.
“Attempting to fulfill the FDA and the EMA requirements would necessitate the initiation of a new clinical trial program which would take several years to complete,” Merck said in the statement.