Regeneron Pharmaceuticals (NASDAQ:REGN) shares tumbled nearly 12% in premarket trading on Monday after the biotechnology company announced that its phase 3 melanoma study involving fianlimab failed to meet its main clinical objective.
Phase 3 trial misses primary goal
The company said the study in metastatic melanoma patients did not reach statistical significance for its primary endpoint, which was improvement in progression-free survival.
Despite missing the main target, Regeneron reported that the high-dose fianlimab combination demonstrated a numerical improvement of 5.1 months in median progression-free survival compared with pembrolizumab used as a standalone therapy.
Regeneron also noted that a separate phase 3 head-to-head study comparing the high-dose fianlimab combination against Opdualag, the combination treatment of nivolumab and relatlimab-rmbw, is still underway.
Analysts cut ratings and price targets
Following the trial results, Citi downgraded Regeneron shares to neutral from buy and reduced its price target to $700 from $900.
Analyst Geoffrey Meacham said the downgrade was driven by the disappointing phase 3 findings for fianlimab in metastatic melanoma.
Meacham added that he expects continued pressure on the stock after the trial outcome.
BMO analyst Evan David Seigerman also lowered his target price on the shares by nearly 20% in response to the update.
“This was to be the defining catalyst of 1H26, with share sentiment inextricably tied to this release,” he said.