FRANKFURT, June 25 (Reuters) - Shares in Germany's Merck KGaA slumped 8.9% at the open on Tuesday after the diversified group late on Monday said a trial testing a head and neck cancer drug, previously seen as promising, would be stopped for lack of efficacy.
The failure of drug candidate xevinapant is the latest in a string of high-profile development setbacks, shifting the focus to the group's two other divisions, making specialty chemicals for the electronics industry as well as lab gear and supplies for the biotech sector.
"This is (another) surprising setback for the healthcare pipeline. We continue to like the Merck story but concede the company will need to rebuild credibility regarding its pipeline prowess," Barclays analysts said in a research note.
For Merck's medium-sized pharma unit, the aborted trials marks another major development setback after its experimental
multiple sclerosis
A previous drug hopeful, experimental cancer treatment bintrafusp alfa, fell short in a 2021 trial, triggering the end of an alliance with GSK. (Reporting by Ludwig Burger Editing by Miranda Murray)
Glaxosmithkline (GSK)
