Pharmaceutical sector mainstay Gilead Sciences(NASDAQ: GILD) has had many good days on the stock exchange, but Monday wasn't one of them. On the back of dispiriting clinical trial results for one of its investigational medications, investors sent the company's share price down by more than 10%. And that was on a day when the bellwether S&P 500 index ended in positive territory, rising almost 0.3%.
Trodelvy didn't meet its latest primary endpoint
That trial was a late-stage one for Trodelvy, an approved cancer medication. Gilead was hoping to expand its Food and Drug Administration (FDA) approval to cover patients with advanced or metastatic non-small cell lung cancer (NSCLC) that had progressed following the administration of platinum-based chemotherapy and checkpoint inhibitor therapy.
Unfortunately, in the phase 3 study, Trodelvy did not meet its primary endpoint of overall survival (OS) for the drug's recipients.
On a brighter note, Gilead said, "A numerical improvement in OS favoring SG was observed in the study, including in patients with both squamous and non-squamous histology."
NSCLC is the most common form of lung cancer; thus, the trial's general results are a setback for that relatively large patient population.
Gilead quoted its chief medical officer Merdad Parsey as saying that the pharmaceutical company will continue to work toward identifying metastatic NSCLC patents that might benefit from Trodelvy.
The $21 billion gamble
Gilead continues to have high ambitions for the cancer drug, which was the star asset in the company's $21 billion acquisition of peer Immunomedics in 2020. There are other investigational avenues it can pursue in developing the drug, so Monday's investor reaction feels a bit overblown; Gilead bulls might do well hanging on to their stock despite the sell-off.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Gilead Sciences. The Motley Fool has a disclosure policy.
