Shares of Immunovant (NASDAQ:IMVT), a clinical-stage biopharmaceutical company, were down by 43.2% as of 2:57 p.m. EST on Tuesday, after plunging by as much as 48% earlier in the day. The losses came after Immunovant announced an update regarding one of its ongoing clinical trials.
Immunovant is developing IMVT-1401 for the treatment of several conditions, including thyroid eye disease (TED). During a phase 2b clinical trial, Immunovant recorded cases of elevated total cholesterol and LDL levels in patients treated with IMVT-1401. LDL stands for low-density lipoprotein, and it is a form of cholesterol.
High levels of LDL can lead to severe health consequences, including heart attack and stroke. Immunovant said that based on preliminary data on 40 patients, mean LDL levels increased by about 65% in the 680mg dose group after 12 weeks, and mean LDL levels in the 340mg dose group increased by about 40% in the same period. Mean LDL levels did not increase in the placebo group after 12 weeks.
However, the company also noted that at the 20-week mark, average LDL levels had dropped to baseline or lower in all three groups. According to Immunovant, there were no serious cardiovascular events reported during the trial. Immunovant decided to pause the study and inform all concerned parties (including patients and regulators). The company's decision to put the study on hold and the reason why it (wisely) chose to do so explain its stock price falling off a cliff today.
The market doesn't like uncertainty, and while we don't know for sure whether the higher LDL observed in patients taking IMVT-1401 after 12 weeks was due to the experimental medicine, today's news was enough to scare off investors. And considering IMVT-1401 is Immunovant's only pipeline candidate at the moment (the company has no products on the market), staying far away from this healthcare stock seems like the right move.