Why Gossamer Bio Stock Is Crashing Today
Shares of Gossamer Bio (NASDAQ: GOSS) were crashing 37.7% lower as of 11:31 a.m. EST on Monday. The big sell-off came after Novartis (NYSE: NVS) announced it was discontinuing development of fevipiprant as a potential treatment for asthma after disappointing results in late-stage clinical studies. Both fevipiprant and Gossamer's lead candidate, GB001, use the same mechanism of action by inhibiting DP2 pathways.
The setback for fevipiprant wasn't unexpected. Novartis reported in October that the drug failed to meet the primary endpoint in two late-stage clinical studies. That news caused Gossamer's share price to swing wildly, with pessimism giving way to optimism that GB001 might be successful despite fevipiprant's setback. Novartis' latest update appears to have zapped all of that optimism.
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Source Fool.com