UNITED KINGDOM — AstraZeneca, the Anglo-Swedish pharmaceutical company, has experienced a significant drop in stock market value, with nearly £14 billion (US$17.8 billion) being wiped off its market capitalization.

Concerns arose regarding the potential success of a new lung cancer drug, datopotamab deruxtecan, which belongs to the promising class of antibody-drug conjugates (ADCs).

The drug combines tumor-targeting monoclonal antibodies with chemotherapy to effectively combat cancer cells.

Shares in AstraZeneca closed down 8% on Monday following the release of the initial results from the drug’s phase 3 trial.

This decline made it the top loser among FTSE 100 companies, raising uncertainties about the drug’s efficacy and market prospects.

The cell-killing molecules of datopotamab deruxtecan bind to a protein called TROP2, which is associated with the majority of lung cancers.

Gilead, a leading pharmaceutical company, has already made strides in targeting the TROP2 protein with its ADC drug Trodelvy, approved for specific breast and bladder cancers.

Meanwhile, Merck & Co. and its partner Kelun-Biotech of China are in the early stages of developing a drug candidate in the same class.

AstraZeneca obtained collaboration rights to datopotamab deruxtecan through a 2020 deal worth up to US$6 billion with Daiichi Sankyo, strengthening their successful partnership focused on ADC drug Enhertu for breast cancer and other malignancies.

AstraZeneca, in collaboration with Daiichi Sankyo, reported that the study demonstrated the potential of the drug to halt the progression of lung cancer in patients for a longer duration compared to the current chemotherapy standard, docetaxel.

However, it was too early to determine statistically significant improvements in overall survival.

Susan Galbraith, AstraZeneca’s executive vice-president of oncology research and development, described the trial results as “compelling evidence” of the drug’s potential to treat lung cancer patients.

Despite this positive outlook, investors reacted by reducing the market value of the pharmaceutical giant due to concerns that datopotamab deruxtecan might not match the success of other AstraZeneca-developed drugs, like Enhertu.

Interpreting clinical significance

Barclays and Credit Suisse analysts suggested that shareholders were anticipating AstraZeneca to declare the trial results as “clinically meaningful.”

In response, the company emphasized that the assessment of clinical significance is subjective and requires further analysis to properly interpret the data.

AstraZeneca reported that some trial participants experienced fatalities due to interstitial lung disease, but clarified that the drug’s safety profile aligned with observations from previous clinical trials.

The company, along with Daiichi Sankyo, intends to share all the data with regulatory authorities to discuss the next steps. Further details about the trial will be presented at an upcoming medical conference.

AstraZeneca affirmed that the datopotamab deruxtecan trial will proceed as planned, evaluating the drug’s impact on the overall survival of patients—an important measure of its efficacy.

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