What happened

Shares of Momenta Pharmaceuticals (NASDAQ:MNTA) fell 11.3% on Thursday, after the company presented data on its drug pipeline at the biotech's R&D day.

So what

Momenta Pharmaceuticals finally announced the diseases it's going after with M281, a drug designed to lower immunoglobulin G (IgG) levels: generalized myasthenia gravis (gMG) and hemolytic disease of the fetus and newborn (HDFN).

Currently, gMG patients are treated with immunosuppressants. The drugs successfully lower IgG levels but can cause an increase in infections, which Momenta hasn't seen with M281 so far in studies with healthy volunteers. The company is shooting for starting the phase 2 study at the end of this year, putting a readout in 2020.

HDFN is caused by blood-type mismatch between a mother and the fetus, in which the mother's antibodies attack the fetus' red blood cells. To treat the eventual anemia, fetuses are often given intrauterine transfusions, an invasive procedure that should be avoided if possible. The phase 2 study will also start later this year, but given the longer treatment time, it won't read out until 2021.

The company also went over its plan for a phase 1/2 trial testing another drug, M254, in patients with immune thrombocytopenic purpura, an autoimmune disease that reduces blood platelets. The study will start later this year or early in 2019 and read out in 2020.

Male scientist working in a laboratory

Image source: Getty Images.

Now what

There didn't seem to be anything negative in the presentation that would justify a double-digit decline in the stock price. Instead, today's move likely had to do with investors realizing there won't be a quick turnaround for Momenta Pharmaceuticals as it transitions from a company focused on biosimilars and other hard-to-create generic drugs to one focused on immune-mediated diseases. With phase 2 readouts not expected until 2020, Momenta is most appropriate for a long-term investor with a set-it-and-forget-it mentality.

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