Ventyx Nixes Psoriasis Candidate Despite Positive Results, Stock Nosedives 75%

Stock dropping/iStock, coffeekai

Pictured: Illustration of stock price dropping dramatically/iStock, coffeekai

Despite reporting statistically positive Phase II results, Ventyx Biosciences eliminated its oral tyrosine kinase 2 inhibitor for psoriasis Monday, sending the company’s stock plunging over 75% in Tuesday’s premarket trading.  

VTX958 achieved its primary and secondary endpoints by achieving a 75% reduction in the Psoriasis Area and Severity Index (PASI) in the 16-week SERENITY trial in moderate to severe plaque psoriasis. However, Ventyx CEO Raju Mohan was “disappointed by the magnitude of efficacy observed” and said in a statement that the results do not support development in the competitive indications of psoriasis and psoriatic arthritis. Phase II trials for both indications were terminated. 

The TYK2 inhibitor is also being tested for Crohn’s disease. The Phase II trial will continue enrollment for now, with an interim analysis planned for the first quarter of 2024, according to the company. 

Although continuing in Crohn’s, analysts and investors do not seem too hopeful. The steep stock price drop means Ventyx is now trading below its cash balance with a market value currently of around $160 million. 

Jefferies analysts pointed to the high level of trial dropouts—20%—driven by adverse events, an effect that lowered the PASI. The assumption is that a similar effect may occur in the Crohn’s trial.  

Jared Holz, an analyst for Mizuho Securities, echoed Ventyx’s statement regarding the competitive landscape. Holz wrote a cautionary note to investors about “too many assets vying for positioning within already well-constructed markets.” 

Bristol Myers Squibb had the first TYK2 approved in 2022 for psoriasis, avoiding the black box warning found on prior JAK inhibitors. Sales of Sotyktu have been slowly ramping up, bringing in $66 million in the third quarter of this year. The drug is expected to become a blockbuster, with global sales forecasted at $2.9 billion by 2029. In the Phase III trial for BMS’ inhibitor, adverse event-related discontinuations were lower in the Sotyktu group versus placebo or apremilast groups.  

In October 2023, Ventyx announced positive Phase II results for its S1P1 receptor modulator, which the company hopes will be a “best-in-disease" oral therapy for ulcerative colitis. Yet, this candidate will face stiff competition as well. Pfizer’s Velsipity, an asset picked up in a $6.7 billion buy of Arena Pharmaceutical, was approved the same month for ulcerative colitis. BMS’s Zeposia was the first S1P receptor modulator to hit the market for the indication in 2021. 

Kate Goodwin is a freelance life science writer based in Des Moines, Iowa. She can be reached at kate.goodwin@biospace.com and on LinkedIn.   

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