GSK (LON:GSK) investors took a sharp knock on Friday after its much-hyped blood cancer drug, Blenrep, was dealt another blow in the US.
Shares tumbled over 6% as an FDA advisory panel recommended against approving the treatment, citing familiar concerns over serious eye-related side effects.
This is an ugly deja vu for GSK. Blenrep was yanked from the US market in 2022 after failing a key study, and this latest rejection makes a comeback look increasingly improbable. The FDA isn’t bound to follow the committee’s vote, but history suggests a turnaround here is unlikely.
The timing couldn’t be worse. GSK has been pitching Blenrep as a critical part of its future revenue story, with lofty ambitions of £3 billion in peak annual sales. Its overall target of £40 billion in sales by 2031 now looks even more precarious, especially with blockbuster drugs losing patent protection later this decade.
GSK’s refreshed application was built on fresh clinical trials claiming reduced death risk and delayed disease progression when Blenrep was used in combination therapies. But regulators clearly remain unconvinced, with the FDA committee citing persistent issues like blurred vision, photophobia, and corneal damage. Questions around dosing regimens and a lack of US patient representation in trials didn’t help GSK’s case either.
In Europe and parts of Asia, Blenrep is already approved, but without the US market, by far the most lucrative, the commercial prospects shrink dramatically. Analysts at Barclays, JPMorgan and Berenberg have already started writing down expectations for Blenrep sales, and by extension, GSK’s broader growth trajectory.
With the final FDA decision due next week and Q2 results landing by the end of the month, GSK faces some uncomfortable conversations with shareholders. Blenrep was supposed to be part of the solution to GSK’s post-spin-off identity crisis. Instead, it’s quickly turning into a symbol of the company’s uphill battle to regain investor confidence.