Novartis Stock Falls 10% After Second Drug Trial Setback

Date: September 7, 2026

Key Takeaways

• Novartis stock fell about 10% after del-desiran failed to meet the primary endpoint in a Phase III trial.
• The result followed the recent failure of cardiovascular drug pelacarsen, increasing concerns about the company’s pipeline.
• Vontobel cut its Novartis price target to CHF125 after removing $3 billion in potential peak sales for del-desiran.

Novartis Stock Drops as Del-Desiran Misses Trial Goal

Novartis stock dropped about 10% in Zurich trading on September 8, following disappointing Phase III results for del-desiran, an experimental treatment for myotonic dystrophy type 1 (DM1). The shares fell to approximately CHF112.56, marking a five-day decline of over 14%. This sharp market reaction reflects growing concerns about Novartis’s ability to develop new medicines amidst increasing competition and impending patent expirations for established products.

What Happened in the HARBOR Trial?

The Phase III HARBOR study involved around 150 patients with DM1 over 54 weeks, where participants received either del-desiran or a placebo every eight weeks. The primary endpoint was video hand-opening time, a measure for assessing hand myotonia. Unfortunately, del-desiran did not show a statistically significant improvement over the placebo on this measure. Missing a primary endpoint poses significant challenges for a drug’s approval prospects. However, Novartis noted some clinical activity across secondary endpoints and exploratory analyses, with a safety profile consistent with previous studies. The company plans to evaluate the complete dataset and consult health authorities before deciding on the program's future.

Pelacarsen Failure Increases Pipeline Concerns

This setback for del-desiran follows another Phase III failure involving pelacarsen, an experimental cardiovascular drug. The Lp(a)HORIZON trial, which included 8,323 patients with elevated lipoprotein(a) and established cardiovascular disease, showed that while pelacarsen successfully reduced Lp(a) levels, it failed to significantly lower the risk of cardiovascular death, heart attack, stroke, and urgent coronary procedures compared to placebo. These two failures have heightened concerns regarding Novartis’s pipeline and its ability to support future growth, especially as the company faces increasing generic competition for older products like heart-failure treatment Entresto.

Avidity Acquisition Faces Greater Scrutiny

Novartis's acquisition of Avidity Biosciences in February 2026, valued at approximately $12 billion, included three late-stage neuromuscular programs. The failure of del-desiran, the most advanced of these treatments, has raised questions about the expected returns from this acquisition. Following the trial results, Vontobel removed about $3 billion in potential peak annual sales for del-desiran from its valuation model, lowering its price target for Novartis from CHF128 to CHF125. Despite this, the acquisition still includes two other important experimental drugs: del-zota for Duchenne muscular dystrophy and del-brax for facioscapulohumeral muscular dystrophy, both of which are under FDA review.

Novartis Maintains Its Long-Term Guidance

Despite the recent trial failures, Novartis has maintained its target for net sales to grow at a compound annual rate of 5% to 6% at constant currencies between 2025 and 2030. The company expects this growth to be driven by existing medicines, new indications, and future product launches. Novartis has identified over 30 potential high-value pipeline assets and projected more than 15 potentially submission-enabling trial results over the next two years. However, the recent setbacks have reduced the margin for further clinical disappointments, and investors will be closely monitoring whether established products can deliver sufficient growth to offset the impact of failed programs.

What Could Move Novartis Stock Next?

The immediate focus for Novartis stock will be the full HARBOR dataset. Investors will be looking for consistent and clinically meaningful improvements in secondary endpoints, as well as feedback from regulators. Positive secondary results could influence whether Novartis conducts further analysis or launches another trial. Other potential catalysts include FDA progress for del-zota, future clinical results for del-brax, and sales growth from major products like Kisqali, Kesimpta, and Pluvicto. The recent 10% decline indicates that investors have significantly reduced the expected value of del-desiran, and the stock's future direction may hinge on the broader pipeline's ability to restore confidence in Novartis’s growth strategy for 2025–2030.