By Archishma Iyer
(Reuters) – Shares of biotechnology firm CSL fell to a four-year low on Thursday, after rival Novo Nordisk’s Ozempic drug showed early signs of success in delaying the progression of kidney disease in diabetes patients.
Shares of CSL closed 5.7% lower at A$239.77, their lowest since Oct. 10, 2019, after falling 6.7% earlier in the session. The stock also marked its worst intraday session in four months and was the top loser on the benchmark.
CSL’s Vifor segment, which includes therapies for kidney diseases and iron deficiencies, faces concerns of competition in the segment after Ozempic’s early trial success, analysts said.
The Danish drugmaker on Tuesday said it will stop the trial of the drug ahead of schedule because it was clear from an interim analysis that the treatment would succeed.
The news led to a sharp fall in dialysis providers globally.
CSL Vifor contributed at least 15% of the consolidated group total revenue of $13.31 billion for the fiscal year 2023, according to their annual report.
“I believe the selloff today is being driven on this news from Novo Nordisk which may affect Vifor earnings,” Shane Ponraj, an analyst from Morningstar said.
“At this stage, it is still unclear to what extent CSL’s earnings could be impacted, but the mere presence of more competition was enough to put downward pressure on the stock,” Tim Waterer, chief market analyst from KCM Trade said.
Australian healthcare stocks ended 4.5% lower, their lowest closing level since Oct. 4, 2019, with sector majors Cochlear, Sonic Healthcare and Resmed dropping between 0.2% and 5.1%.
(Reporting by Archishma Iyer in Bengaluru; Editing by Varun H K)
