GSK loses £2bn value after cancer drug trial blow

MORE than £2bn has been wiped off GSK’S value after the pharmaceuticals giant posted disappointing results from its blood cancer drug trial.

GSK said the latest data showed that its drug Blenrep failed to help people whose blood cancer had stopped responding to treatment to live longer without the disease worsening. This is known as “progression-free survival”.

The median overall survival rate for its Blenrep drug was 21.2 months, compared to 21.1 months for the existing treatment of cancer drugs combined with steroids, GSK said. Blenrep had already received approval in the US.

Analysts at JP Morgan said: “Overall, with this data calling into question Blenrep’s approvability in the existing setting and the chances of success in earlier treatment lines, we therefore expect the market to price in a risk that Blenrep approval is rescinded.”

The update sent shares in GSK down by 4.7pc yesterday, wiping £2.8bn off its value.

Earlier this year, GSK bought US drug developer Sierra Oncology, known for its experimental bone marrow cancer drug, in a £1.5bn deal.

GSK has had more firepower to spend on takeovers, after spinning off its consumer health business earlier this year and receiving a £7bn dividend.

GSK also has a 13.5pc stake in Haleon following the split, which it is expected to sell down to free up more cash.

The two businesses have, however, been embroiled in a row in recent weeks related to a heartburn drug at the centre of lawsuits. GSK earlier this month said it was having to set aside £45m for legal costs over Zantac, as it defends itself over claims that the drug causes cancer.