Citi and Morgan Stanley cut price targets for GSK following weeks of setbacks
GlaxoSmithKline (GSK) has rattled the faith of two of the world’s biggest banks, which cut their share price forecasts for the British pharmaceutical giant this week.
The London-listed pharma firm faced a double-barrelled setback to its oncology efforts in November, which has put banks and investors on more cautious footing.
Citigroup earlier today slashed its share price target for GSK from 1975p to 1550p. Yesterday, Morgan Stanley cut its target from 1650p to 1535p.
The Big Pharma firm had sought to ramp up its oncology pipeline following the split from its consumer health unit, now known as Haleon, earlier this year.
But last week, GSK’s blood cancer drug was pulled from the US market over safety concerns, in a major blow to the British pharmaceutical giant’s reputation.
The move on the opposite side of the Atlantic is expected to send shockwaves into Europe.
Dana Gheorghe, director of oncology at pharmaceutical intelligence company Citeline said that it is “likely” the European Medicines Agency will start reviewing Blenrep’s approval “sooner rather than later – unless GSK withdraw the drug from the European market beforehand”.
Blenrep’s setback risks sowing the seed of doubt across the continent, likely troubling doctors within the bloc who may now be questioning their prescription habits.
GSK’s ovarian cancer drug Zejula also failed to exit the FDA’s hawkish scope unscathed.
The drug, which was approved as a maintenance therapy in 2017, was fitted with a narrower use label in the US a week before Blenrep was pulled from the market.
However, hope remains for GSK’s RSV vaccine – which showed very promising results in late-stage trials and could be the first of its kind.
Investors have already outlined the vaccine as a key potential growth driver for the company.