Why Shares of Roivant Sciences Were Down Tuesday
Shares of Roivant Sciences (NASDAQ: ROIV) were down 13.26% in mid-morning trading on Tuesday. The biotech company, which specializes in developing immuno-dermatology therapies, had been riding a rise in share price that occurred after it announced positive data from a phase 3 clinical trial on March 15. The stock's 52-week low is $2.52 and its 52-week high is $10. Over the past 12 months, Roivant shares are up by more than 42%.
A closer look at the company's study on Vtama may be why the stock has fallen back to levels below where it traded prior to the announcement. Roivant said its therapy, Vtama, already approved to treat plaque psoriasis in adults, met its primary endpoint in a phase 3 clinical trial to treat atopic dermatitis patients ages 2 and older. The company said it expects to release data from a second phase 3 trial for the same indication in May. In the first study, the company said that 46.4% of patients who were given Vtama met the primary endpoint of clear or almost clear skin, which may be viewed by some investors as an underwhelming response.
Roivant is a unique company because it develops smaller portfolio healthcare or health technology companies, which it calls "Vants." Vtama is being developed by one such Vant, Dermavant Sciences. The biggest concern is that as of the third quarter, its revenue was declining. In the quarter, the company reported revenue of $17 million, down from $24.3 million in the same period a year ago. The company also lost $384.8 million in Q3 2022, compared to a net loss of $306 million in Q3 2021.
Source Fool.com
