Novartis remains “very happy” with its $12 billion acquisition of Avidity Biosciences, despite a Phase 3 disappointment for the antibody-oligonucleotide conjugate del-desiran.
Novartis stands by its $12 billion takeover of Avidity Biosciences even after del-desiran, one of the main assets driving that buyout, failed a late-stage myotonic dystrophy study and spawned a $1.9 billion partial impairment charge.
“We remain very, very happy with the Avidity acquisition,” Novartis CEO Vas Narasimhan told reporters during a Tuesday morning press call to present the pharma’s third quarter earnings results. “We feel confident that there’s a tremendous value we can still generate off of the platform and the three assets that we acquired.”
Narasimhan attributed the write-down to “the mathematical shift of our assumption.” Novartis still believes in the asset but has adjusted its valuation to account for the need to run an additional pivotal study, which will take time and money, he said.
Del-desiran is an antibody-oligonucleotide conjugate that targets transferrin receptor 1 on muscle cells and tags DMPK messenger RNA for destruction. Myotonic dystrophy type 1 is caused by mutations in the DMPK gene.
In September, data from the Phase 3 HARBOR study—which enrolled 159 patients with DM1 who were randomly assigned to del-desiran or placebo—showed that the investigational therapy failed to hit the study’s primary outcome of improving hand function.
In response to the failure, Oppenheimer in a Sept. 8 note called del-desiran a “$12B disappointment.” But Narasimhan on Tuesday’s press call pointed out that “we saw evidence of clinical activity in the secondary and exploratory endpoints” in HARBOR. The pharma plans to advance del-desiran into another pivotal program and is currently evaluating what the best path forward is, he added.
Narasimhan also emphasized the other clinical assets and the technology for antibody-oligonucleotide conjugates that Avidity brought to the Novartis fold. One of these candidates, called del-brax, is in Phase 3 development for facioscapulohumeral muscular dystrophy and for which the pharma is discussing with the FDA the potential for accelerated approval, Narasimhan said. Another Avidity asset, del-zota, has priority review for certain types of Duchenne muscular dystrophy.
“So in our view, the Avidity acquisition remains absolutely on track,” Narasimhan said. “It’s hit a bump, which is normal, I think, when you’re trying to do pioneering science.”
Other bumps in Novartis’ quarter
Just a few days before the del-desiran announcement, the company reported that the antisense therapy pelacarsen failed to significantly lower cardiovascular risk in a late-stage trial. And these two disappointing readouts followed the news that Novartis had paused a host of mid-stage immunology and neurology studies for its CAR T therapy rapcabtagene autoleucel following three deaths.
These setbacks sent the pharma’s shares down some 13% in a week.
Narasimhan said on Tuesday’s call that while there have been no further safety events to report, those studies remain on hold in U.S. and Europe. “It’s absolutely our goal to get these trials started again,” he said, highlighting the feedback the company has gotten from physicians and patients about the clinical benefits of these CAR T therapies. “We expect in the coming months to be able to provide further updates once we identify the root cause and also understand the best approach to ensure patient safety in the future.”
But Novartis’ rough stretch didn’t end there. Days after news of the trial pauses broke, reports broke that the pharma had discontinued the development of the TREM2 stabilizer lifonebart in amyotrophic lateral sclerosis after the asset showed disappointing functional outcomes in a mid-stage study.
In the third quarter, Novartis reported net sales of $14.5 billion, up 4% year-over-year at constant currencies. The anti-inflammatory drug Cosentyx was Novartis’ top-selling drug for the third quarter with nearly $1.9 billion in earnings, up 9% from the same period last year.
Sales over the first nine months of the year hit $42 billion, flat versus the same period in 2025—though CFO Mukul Mehta pointed out during the press call that Novartis is “absorbing the largest patent expiry in our history.”
The pharma’s Entresto lost exclusivity in summer 2025 and faced immediate generic competition in the U.S. The chronic heart failure drug made $1.16 billion in the third quarter and $3.65 billion so far this year, down 38% and 45% in constant-currency since the same periods last year.
Novartis countered those decline with key growth drivers including the breast cancer drug Kisqali, which grew 37% since Q3 2025 to make $1.8 billion in the third quarter this year, and the multiple sclerosis medicine Kesimpta, which jumped 22% to hit $1.48 billion.
Other high-growth assets include Scemblix, which is indicated for certain types of leukemia and surged 67% year-over-year to bring in $593 million; the cholesterol-lowering Leqvio, which saw a 63% increase to make $506 million in the quarter; and the complement blocker Fabhalta, which soared 60% to $237 million.
Earlier this month, Novartis ended a Phase 2 study for Fabhalta in lupus that has inflamed the kidneys. Aspokesperson said in an email to BioSpace that “the decision was based on strategic considerations and was not driven by any interim efficacy or safety findings.” Novartis will continue to study Fabhalta—which already has approvals in a rare blood disorder called paroxysmal nocturnal hemoglobinuria as well as IgA nephropathy and complement 3 glomerulopathy—in late-stage trials for atypical haemolytic uraemic syndrome and generalized myasthenia gravis.
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