AbbVie stocks have fallen after the FDA warning. Analysts say Selloff is overwhelmed.

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Actions of the pharmacist

AbbVie

fell to 12.2% during intraday trading on Wednesday, closing at 7.1%, after the U.S. Food and Drug Administration said it had determined that the use of a class of drugs known as JAK inhibitors increases the risk of cancer, severely related to heart events and death.

This sale may be excessive, but the FDA announcement has implications for lucrative indications such as atopic dermatitis. It will have far-reaching implications for several large pharmaceutical and biotech companies that could take a long time to gamble.

The FDA said it would require new warnings to be included in the prescribing information for three JAK inhibitors already approved for treatment for arthritis and other inflammatory conditions. Medications are sold by

Pfizer

(ticker: PFE),

Eli Lilly

(LLY), i

AbbVie

(ABBV).

Pfizer

and AbbVie did not immediately respond to requests for comment. Lilly said she has an ongoing post-marketing program to characterize the long-term safety of her JAK Olumiant inhibitor in rheumatoid arthritis and that she has ongoing phase 3 studies of the drug in other conditions.

“We take patient safety seriously and are committed to working with the FDA to communicate appropriate safety information to Olumiant,” the company said. “Based on the available data from the approved indications and the research, we maintain confidence in Oliant’s positive benefit-risk profile.”

The agency said it would not require warnings for two other approved JAK inhibitors, made by

Incyte

(INCY) i

Bristol Myers Squibb

(BMY), because they are used to treat blood disorders instead of inflammatory diseases.

Analysts largely said the sale of AbbVie shares was too excessive and created an opportunity to buy the shares. However, the warning could have an impact on the future prospects of some major drug manufacturers. It could be particularly positive for

Sanofi

(SNY) i

Regeneron

(REGN), Dupixent’s shared overproduction treats some of the same conditions as JAK inhibitors and does not have the same safety concerns.

Shares of Regeneron rose 1.1% on Wednesday, meanwhile

Sanofi

The American deposit receipt increased by 1.5%. Shares of Pfizer, meanwhile, were down 0.1%, while shares of Lilly were down 0.3% and

Incyte

shares gained 0.7%.

Exploration of JAK inhibitors has been on the rise since January, when Pfizer released data from a follow-up study of its JAK Xeljanz inhibitor that the FDA had required as a condition of Xeljanz approval. The study showed that patients with rheumatoid arthritis who took Xeljanz had higher rates of significant adverse cardiac events and cancer than patients with rheumatoid arthritis who took another class of medication.

After the Pfizer study, the FDA said it was evaluating the data. Meanwhile, Canadian regulators began their own safety review.

In addition to requiring new warnings for Pfizer, AbbVie and Lilly drugs, the agency also said healthcare providers should reserve these drugs for patients who have failed treatment with another class of drugs, known as TNF blockers.

“Our review of the final trial results showed a higher rate of serious heart-related events such as heart attack and stroke, cancer, blood clots and death in patients treated with the two doses of Xeljanz in compared to those treated with TNF blockers “. said the agency.

Still, analysts said the AbbVie selloff was exaggerated. In a note released Wednesday, Piper Sandler analyst Christopher Raymond noted that the FDA announcement was not unexpected. “Buyers in weakness,” he wrote about AbbVie. Raymond said he sees a limited short-term impact on AbbVie and said that since the new warning was based on a study on Pelizer Xeljanz, not AbbVie Rinvoq’s JAK inhibitor, doctors “will continue to see the its security profile as differentiated vs. Xeljanz “.

In a separate note, Evercore ISI analyst Josh Schimmer wrote that most use of Rinvoq is already in patients who have already used a TNF blocker. “This update is totally expected for us, but apparently not for investors,” Schimmer wrote.

One analyst who had a weaker view of the impact on AbbVie was Ronnie Gal of Bernstein, who wrote that a 10% drop in the price of AbbVie shares was “adequate.” Rinvoq sales expectations to $ 11.2 billion by 2030, up from $ 17.2 billion.

Geoffrey Porges, an analyst at SVB Leerink, wrote on Wednesday that the update was bad news for Pfizer. “This regulatory action is likely to accelerate Xeljanz’s decline and add to the challenges of investor confidence in the company’s long-term prospects,” Porges wrote.

Porges called the Regeneron and Sanofi winners, saying Dupixent would be “more or less undisputed” in several indications.

Write to Josh Nathan-Kazis at [email protected]